Publication: Liquidity in Retirement Savings Systems: An International Comparison
Loading...
Open/View Files
Date
2015
Published Version
Journal Title
Journal ISSN
Volume Title
Publisher
American Economic Association
The Harvard community has made this article openly available. Please share how this access benefits you.
Citation
Beshears, John, James J. Choi, Joshua Hurwitz, David Laibson, and Brigitte C. Madrian. 2015. “Liquidity in Retirement Savings Systems: An International Comparison.” American Economic Review 105 (5) (May): 420–425. doi:10.1257/aer.p20151004.
Abstract
We compare the liquidity that six developed countries have built into their employer-based defined contribution (DC) retirement schemes. In Germany, Singapore, and the UK, withdrawals are essentially banned no matter what kind of transitory income shock the household realizes. By contrast, in Canada and Australia, liquidity is state-contingent. For a middle-income household, DC accounts are completely illiquid unless annual income falls substantially, in which case DC assets become highly liquid. The US stands alone in the universally high liquidity of its DC system: whether or not income falls, the penalties for early withdrawal are low or non-existent.
Description
Other Available Sources
Research Data
Keywords
Terms of Use
This article is made available under the terms and conditions applicable to Other Posted Material (LAA), as set forth at Terms of Service