The Implementation of State Sponsored Retirement Plans

47 Pages Posted: 5 Apr 2015 Last revised: 14 Jul 2015

See all articles by Bruce I. Carlin

Bruce I. Carlin

University of California, Los Angeles (UCLA) - Anderson School of Management

Shaun Davies

University of Colorado at Boulder - Leeds School of Business

Date Written: July 13, 2015

Abstract

State sponsored retirement plans have been proposed and implemented to provide people with new access to defined contribution retirement opportunities. Many of these people have no other options and typically have low income and are less educated. We study optimal plan implementation in a theoretical model and analyze how the right menu of portfolio options and default option should be chosen based on the financial sophistication of the participants, their behavioral biases, the prevalent political philosophy, and the political economy. The paper provides several novel positive and normative implications, which appear to be empirically plausible.

JEL Classification: G11, G1, G2, G28

Suggested Citation

Carlin, Bruce I. and Davies, Shaun, The Implementation of State Sponsored Retirement Plans (July 13, 2015). Available at SSRN: https://ssrn.com/abstract=2589701 or http://dx.doi.org/10.2139/ssrn.2589701

Bruce I. Carlin

University of California, Los Angeles (UCLA) - Anderson School of Management ( email )

110 Westwood Plaza
Los Angeles, CA 90095-1481
United States

Shaun Davies (Contact Author)

University of Colorado at Boulder - Leeds School of Business ( email )

Boulder, CO 80309-0419
United States

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