Individual Retirement Accounts, Self-control and Intergenerational Welfare

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Individual Retirement Accounts, Self-control and Intergenerational Welfare

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dc.contributor.author Fehr, Hans en_US
dc.contributor.author Habermann, Christian en_US
dc.date.accessioned 2009-02-04T10:28:18Z
dc.date.available 2009-02-04T10:28:18Z
dc.date.issued 2007-12-04T00:00:00Z en_US
dc.identifier.uri http://hdl.handle.net/10398/7710
dc.description.abstract The present paper studies the growth and efficiency consequences of tax-favored individual retirement accounts in a general equilibrium overlapping generations model with idiosyncratic lifespan and labor income uncertainty. We distinguish between economies with rational and with hyperbolic consumers and compare the consequences of mandatory and voluntary retirement plans with and without annuitized benefits. While a full taxation of capital income yields the highest efficiency gains in the rational consumer model, annuitization and hyperbolic discounting substantially improve the economic efficiency of IRAs. We also show that annuitization alters the intergenerational welfare consequences of the reform substantially, since it reduces accidental bequests. Finally, even if mandatory saving programs have a clear cost advantage, they are only recommendable if consumers are myopic. individual retirement accounts, annuities, stochastic general equilibrium, hyperbolic consumers en_US
dc.format.extent 32 s. en_US
dc.language eng en_US
dc.relation.ispartofseries Discussion paper;2007-11 en_US
dc.title Individual Retirement Accounts, Self-control and Intergenerational Welfare en_US
dc.type wp en_US
dc.accessionstatus modt07dec04 nijemo en_US
dc.contributor.corporation Copenhagen Business School. CBS en_US
dc.contributor.department Centre for Economic and Business Research en_US
dc.contributor.departmentshort CEBR en_US
dc.contributor.departmentuk Centre for Economic and Business Research en_US
dc.contributor.departmentukshort CEBR en_US
dc.idnumber x656555490 en_US
dc.publisher.city København en_US
dc.publisher.year 2007 en_US


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