Lopes, Paula and Michaelides, Alexander (2005) Rare events and annuity market participation. Discussion paper: UBS Pensions Series 039, 553. Financial Markets Group, London School of Economics and Political Science, London, UK.
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We investigate whether a rare event (like the default of the annuity provider) can explain the annuity market participation puzzle. High risk aversion is needed to change behavior in the presence of such a disastrous shock but higher risk aversion also makes annuities more valuable. Therefore, these rare events are unlikely candidates to explain the low take-up of voluntary annuities.
|Item Type:||Monograph (Discussion Paper)|
|Additional Information:||© 2005 The Authors|
|Uncontrolled Keywords:||Annuity provision, Saving during retirement, Rare events.|
|Library of Congress subject classification:||H Social Sciences > HF Commerce
H Social Sciences > HG Finance
H Social Sciences > HB Economic Theory
|Journal of Economic Literature Classification System:||H - Public Economics > H0 - General > H00 - General
E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Employment, and Investment > E21 - Macroeconomics: Consumption; Saving; Aggregate Physical and Financial Consumer Wealth
|Sets:||Research centres and groups > Financial Markets Group (FMG)
Collections > Economists Online
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