Social Security as a Financial Asset: Gender-Specific Risks and Returns / Marianne Baxter.

Format:

Book

Author/Creator:

Baxter, Marianne.

Contributor:

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w8329.

NBER working paper series no. w8329

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Social Security as a Financial Asset

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2001.

Summary:

Social Security is a financial asset whose 'purchase' is compulsory for most working individuals; the return during the individual's working lifetime is related to the rate of change of aggregate labor income. If an individual's labor income is strongly related to aggregate labor income, then the Social Security asset is a particularly unattractive asset. In this situation, the individual would benefit from a reformed Social Security system that would permit investment of retirement funds in other financial assets. This paper investigates how this aspect of Social Security risk varies across groups of individuals who differ according to gender; education; race; and age. The main finding is that there are important differences across groups in this component of Social Security risk, as captured by the sensitivity of individual-level income growth to changes in the SSWI. This element of risk is most important for women, especially women who are young-to-middle aged and with more education. This analysis suggests that women would have more to gain, compared with men, from a reformed Social Security system.

Notes:

Print version record

June 2001.