More Social Security, Not Less

22 Pages Posted: 12 Apr 2005  

William N. Goetzmann

Yale School of Management - International Center for Finance; National Bureau of Economic Research (NBER)

Date Written: April 12, 2005

Abstract

This paper explores the feasibility of a government-sponsored insurance company, patterned after the government-sponsored mortgage agencies, that would be authorized to sell government-insured wage-indexed retirement annuities. This enterprise would assume the current obligations and cash flows of the social security system in exchange for the exclusive right to sell additional insurance contracts. It may or may not choose to finance itself through the issuance of equity shares. The empirical analysis in the paper focuses on the stochastic nature of the liabilities faced by such an agency and in particular examines the optimal portfolio of assets required to hedge wage-indexed liabilities.

Keywords: Social Security, Wage Inedexation

JEL Classification: G22, H55

Suggested Citation

Goetzmann, William N., More Social Security, Not Less (April 12, 2005). Yale ICF Working Paper No. 05-05. Available at SSRN: https://ssrn.com/abstract=703141

William N. Goetzmann (Contact Author)

Yale School of Management - International Center for Finance ( email )

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