TY - JOUR T1 - Framing and Claiming: How Information-Framing Affects Expected Social Security Claiming Behavior JF - Journal of Risk and Insurance Y1 - 2016 A1 - Brown, Jeffrey R. A1 - Arie Kapteyn A1 - Olivia S. Mitchell AB - This article provides evidence that Social Security benefit claiming decisions are strongly affected by framing and are thus inconsistent with expected utility theory. Using a randomized experiment that controls for both observable and unobservable differences across individuals, we find that the use of a “breakeven analysis” encourages early claiming. Respondents are more likely to delay when later claiming is framed as a gain, and the claiming age is anchored at older ages. Additionally, the financially less literate, individuals with credit card debt, and those with lower earnings are more influenced by framing than others. VL - 83 UR - http://doi.wiley.com/10.1111/jori.v83.1http://doi.wiley.com/10.1111/j.1539-6975.2013.12004.xhttps://api.wiley.com/onlinelibrary/tdm/v1/articles/10.1111%2Fj.1539-6975.2013.12004.x IS - 1 JO - Journal Risk and Insurance ER - TY - JOUR T1 - The Effect of Inheritance Receipt on Retirement JF - Review of Economics and Statistics Y1 - 2010 A1 - Brown, Jeffrey R. A1 - Courtney Coile A1 - Weisbenner, Scott J KW - Adult children KW - Employment and Labor Force KW - Net Worth and Assets KW - Other KW - Retirement Planning and Satisfaction AB - This paper provides new evidence on how wealth shocks influence retirement behavior. Economic theory generally posits that leisure is a normal good, yet it is difficult to obtain reliable empirical estimates of the wealth effect because wealth is correlated with numerous unobservable characteristics that affect labor supply. We use inheritance receipt as a wealth shock and find that it is associated with a significant increase in the probability of retirement, especially when the inheritance is unexpected. This evidence has important implications for how public policies, such as pension or tax reform, may influence retirement behavior through the wealth effect. PB - 92 VL - 92 IS - 2 U4 - Wealth/Impact analysis/Retirement planning/Inheritances/Studies/Labor supply ER - TY - RPRT T1 - Who Values the Social Security Annuity? New evidence on the annuity puzzle Y1 - 2008 A1 - Brown, Jeffrey R. A1 - Casey, Marcus D. A1 - Olivia S. Mitchell KW - Methodology KW - Net Worth and Assets KW - Pensions KW - Social Security AB - We examine individuals' self-reported willingness to exchange part of their Social Security inflation-indexed annuity benefit for an immediate lump-sum payment, using an experimental module in the 2004 Health and Retirement Study. Our first finding is that nearly three out of five respondents favor the lump-sum payment if it were approximately actuarially fair, a finding that casts doubt on several leading explanations for why more people do not annuitize. Second, there is some modest price sensitivity and evidence consistent with adverse selection; in particular, people in better health and having more optimistic longevity expectations are more likely to choose the annuity. Third, after controlling on education, more financially literate individuals prefer the annuity. Fourth, people anticipating future Social Security benefit reductions are more likely to choose the lump-sum, suggesting that political risk matters. Other factors such as sex, marital status, income, wealth, or the presence of children are not associated with respondents' relative preferences for the annuity versus the lump-sum. JF - NBER Working Paper PB - National Bureau of Economic Research CY - Cambridge, MA U4 - Social Security/Social Security Research/lump sum distributions/Annuities ER - TY - CHAP T1 - Are the Elderly Really Over-Annuitized? New Evidence on Life Insurance and Bequests T2 - Themes in the Economics of Aging Y1 - 2001 A1 - Brown, Jeffrey R. ED - David A Wise KW - Adult children KW - Demographics KW - Insurance KW - Net Worth and Assets AB - This paper assesses the validity of the claim that elderly individuals with strong bequest motives purchase term life insurance to offset mandatory annuitization by the Social Security System. The annuity offset model is re-examined using better, more recent data. Results demonstrate that the elderly do not hold life insurance to offset mandated annuitization. All four of the major implications of the annuity offset model fail empirical testing. The model does not explain life insurance behavior of elderly households and the fact that many elderly households own term life insurance is not a sufficient reason to argue against mandatory annuitization of retirement resources. Further research is being conducted using the AHEAD data in order to find other explanations for why the elderly hold life insurance. JF - Themes in the Economics of Aging PB - University of Chicago Press CY - Chicago UR - http://www.nber.org/papers/w7193 N1 - ProCite field 6 : In ProCite field 8 : ed. U4 - Life Insurance Coverage/Economic Status/Bequest Motives/Basic Demographics JO - Are the Elderly Really Over-Annuitized? New Evidence on Life Insurance and Bequests ER - TY - RPRT T1 - Longevity-Insured Retirement Distributions from Pension Plans: Market and Regulatory Issues Y1 - 2001 A1 - Brown, Jeffrey R. A1 - Mark J. Warshawsky KW - Demographics KW - Health Conditions and Status KW - Insurance AB - Increasing average longevity and the trend toward early retirement make the risk of outliving one's resources more widespread among the elderly population. Annuities insure individuals against financial risks associated with longevity uncertainty. This paper explores the extent to which retirees can and do insure themselves against longevity risk in private pension plans. The shift from defined benefit (DB) plans to defined contribution (DC) plans means a reduction in the opportunities available to retirees to annuitize retirement assets because only a small number of DC plans include life annuity as a payout option. The paper discusses some of the options available to policy makers interested in increasing the annuitization rates. JF - NBER Working Paper PB - The National Bureau of Economic Research CY - Cambridge, MA UR - http://www.nber.org/papers/w8064 U4 - Insurance Coverage/Basic Demographics/Longevity ER - TY - JOUR T1 - Private Pensions, Mortality Risk, and the Decision to Annuitize JF - Journal of Public Economics Y1 - 2001 A1 - Brown, Jeffrey R. KW - Net Worth and Assets KW - Pensions PB - 82 VL - 82 IS - 1 U4 - Annuities/Pensions ER - TY - RPRT T1 - Differential Mortality and the Value of Individual Account Retirement Annuities Y1 - 2000 A1 - Brown, Jeffrey R. KW - Income KW - Net Worth and Assets AB - This paper examines the extent of redistribution that would occur under various annuity and bequest options as part of an individual accounts retirement program. I first estimate mortality differentials by gender, race, ethnicity and level of education using the National Longitudinal Mortality Study and document substantial differences. I then use these estimates to examine the expected transfers that would take place between socioeconomic groups under different assumptions about the structure of an annuity program. Using an expected present discounted value or money s worth calculation as the basis for comparison, I find that the size of transfers in an individual accounts program is highly sensitive to the benefit structure. For example, mandating a single-life, real annuity can result in expected transfers of as high as 20 of the account balance, often from economically disadvantaged groups toward groups that are better off. These transfers can be substantially reduced through the use of joint life annuities, survivor provisions and bequest options. For example, the largest expected negative transfer under a joint and full survivor annuity with a fully valued 20-year guarantee option is only 2 of the account balance. However, efforts to reduce the extent of redistribution generally do so at the cost of significantly lower annuity benefits paid to the individuals who contribute to the system. PB - National Bureau of Economic Research, NBER Working Paper 7560 UR - http://www.nber.org/papers/ N1 - RDA; National Institute of Aging and the National Bureau of Economic Research U4 - Annuities/redistribution ER - TY - RPRT T1 - How Should We Insure Longevity Risk in Pensions and Social Security? Y1 - 2000 A1 - Brown, Jeffrey R. KW - Health Conditions and Status KW - Pensions KW - Social Security JF - Center for Retirement Research at Boston College Briefs PB - Center for Retirement Research at Boston College CY - Boston UR - https://crr.bc.edu/briefs/how-should-we-insure-longevity-risk-in-pensions-and-social-security/ U4 - Longevity/Pensions/Social Security ER - TY - RPRT T1 - Mortality Risk, Inflation Risk, and Annuity Products Y1 - 2000 A1 - Brown, Jeffrey R. A1 - Olivia S. Mitchell A1 - James M. Poterba KW - Annuitization KW - Mortality KW - Older Adults KW - Risk Factors AB - As growing numbers of retirees reach retirement age with substantial balances in self-directed retirement plans, annuities are likely to become increasingly important instruments for drawing down retirement savings. This study explores recent trends in the pricing of single-premium annuity products in the United States. Virtually all of the annuity products currently available in the United States offer fixed nominal payouts, rather than an inflation-linked payout stream. After describing the money's worth' of the various types of nominal annuity products, this study considers the extent to which existing U.S. private annuity markets provide retirees with inflation-protected retirement income flows. Although there is effectively no market yet for inflation-indexed annuities in the United States, such products are available in other countries. The paper concludes by summarizing recent data on the pricing of both nominal and inflation-linked annuities in the United Kingdom and several other nations. JF - NBER Working Paper Series PB - National Bureau of Economic Research CY - Cambridge, MA UR - https://www.nber.org/papers/w7812.pdf ER - TY - JOUR T1 - New Evidence on the Money's Worth of Individual Annuities JF - The American Economic Review Y1 - 1999 A1 - Olivia S. Mitchell A1 - James M. Poterba A1 - Mark J. Warshawsky A1 - Brown, Jeffrey R. KW - Age KW - Annuity payments KW - Income taxes KW - Insurance premiums KW - Life annuities KW - Life insurance KW - Life Tables KW - Men KW - Mortality rates VL - 89 SN - 00028282 UR - https://www.jstor.org/stable/117059?seq=1 IS - 5 ER -