The Economic Theory of Annuities 9 doc

... (4.4). When there is a positive rate of interest on assets, the competitive rate of return on annuities is equal to the rate of interest plus the hazard rate. The reason is obvious: The issuers of annuities ... expectancy of the owners. The other risk class experiences a loss for the opposite reason. Another important implication of the fact that in equilibri...

Ngày tải lên: 21/06/2014, 07:20

... tends to mitigate the effects of adverse selection because, when bundled, the negative correlation between the costs of these products reduces the overall variation of the costs of the bundle with individual ... y, (14.24) where a is the amount of annuities, z is expected lifetime, b is the amount of life insurance (=bequests), and y is the amount of the num...

Ngày tải lên: 21/06/2014, 07:20

... description of the motivation for and the stipulations of these annuities from a textbook for actuaries: These are usually effected to avoid the disappointment that is often felt in the event of the ... to make the price of period- certain annuities commensurate with the price of regular annuities. These annuities are available in the United Kingdom, where th...

Ngày tải lên: 21/06/2014, 07:20

... 0 .95 5567 0 .97 2336 0 .97 7086 0 .98 5266 67 0 .93 1401 0 .95 6873 0 .96 4103 0 .97 692 2 68 0 .90 6303 0 .94 0484 0 .94 993 5 0 .96 7886 69 0.880455 0 .92 3244 0 .93 4 490 0 .95 8116 70 0.853800 0 .90 5086 0 .91 7 697 0 .94 7530 71 0.826172 ... 0.885875 0. 899 490 0 .93 6004 72 0. 797 493 0.865541 0.8 798 29 0 .92 3386 73 0.767666 0.84 399 8 0.858678 0 .90 9 496 74 0.7365 89 0.821157...

Ngày tải lên: 21/06/2014, 07:20

... total consumption in the second period. The second term is the sum of the expected utilities of two surviving individuals, while the third is the expected utility of one survivor. The budget constraint ... Annuitization Suppose that the individual can purchase or sell at any age an asset called annuities. The quantity of annuities at age z is denoted a(z). A unit...

Ngày tải lên: 21/06/2014, 07:20

... accross states of nature). Sequential annuity market equilibrium is characterized by the purchase of long-term annuities, short sale of some of these annuities later on, or the purchase of additional short-term ... in favor of such options. A vast economic literature reports experimental and empirical evidence of the bounded rationality and shortsightedness of indiv...

Ngày tải lên: 21/06/2014, 07:20

... Henry and Chaloupka, Frank J. The Demand for Illicit Drugs,” Economic Inquiry, 37, No. 3, July 199 9, pp. 401-411. The Economic Theory of Illegal Goods: the Case of Drugs Gary S. Becker, Kevin ... SERIES THE ECONOMIC THEORY OF ILLEGAL GOODS: THE CASE OF DRUGS Gary S. Becker Kevin M. Murphy Michael Grossman Working Paper 1 097 6 http://www.nber.org/papers/w1 097 6...

Ngày tải lên: 23/03/2014, 20:20

... in favor of such options. A vast economic literature reports experimental and empirical evidence of the bounded rationality and shortsightedness of individuals (e.g., Rabin, 199 8, 199 9; Mitchell ... accross states of nature). Sequential annuity market equilibrium is characterized by the purchase of long-term annuities, short sale of some of these annuities later on, o...

Ngày tải lên: 20/06/2014, 20:20

... in insurance markets: The cause of the inefficiency is that individuals disregard the effect of their actions on the equilibrium rate of return on annuities. Essentially, these distortions are ... years has focused on the design of SS reforms aimed at closing these deficits. The issues involved are not only the economics of annuities but also much broader issues such...

Ngày tải lên: 21/06/2014, 00:20

... in insurance markets: The cause of the inefficiency is that individuals disregard the effect of their actions on the equilibrium rate of return on annuities. Essentially, these distortions are ... particular, the age of the purchaser. 1 The demand for annuities is primarily based on the desire of individu- als to insure a flow of income during retirement against...

Ngày tải lên: 21/06/2014, 09:20