Charles Blahous, one of the nation's foremost retirement security experts, explains the origins and dangers of current underfunding in our single-employer defined-benefit pension system and outlines the options for solving the problem and preventing the next taxpayer-financed bailout. He provides a tutorial on the basic workings of pension law, reviews the recent history that led to the worsening condition of the pension insurance system, and suggests a range of reforms to improve the system's operation and to resolve the projected shortfall.

Charles Blahous, one of the nation's foremost retirement security experts, explains the origins and dangers of current underfunding in our single-employer defined-benefit pension system and outlines the options for solving the problem and preventing the next taxpayer-financed bailout. He provides a tutorial on the basic workings of pension law, reviews the recent history that led to the worsening condition of the pension insurance system, and suggests a range of reforms to improve the system's operation and to resolve the projected shortfall.

Pensions in the U.S. Economy is the fourth in a series on pensions from the National Bureau of Economic Research. For both economists and policymakers, this volume makes a valuable contribution to current research on pensions and the economics of the elderly. The contributors report on retirement saving of individuals and the saving that results from corporate funding of pension plans, and they examine particular aspects of the plans themselves from the employee's point of view. Steven F. Venti and David A. Wise offer a careful analysis of who contributes to IRAs and why. Benjamin M. Friedman and Mark Warshawsky look at the reasons more retirement saving is not used to purchase annuities. Personal saving through pension contribution is discussed by B. Douglas Bernheim and John B. Shoven in the context of recent government and corporate pension funding changes. Michael J. Boskin and John B. Shoven analyze indicators of the economic well-being of the elderly, addressing the problem of why a large fraction of the elderly remain poor despite a general improvement in the economic status of the group as a whole. The relative merits of defined contribution versus defined benefit plans, with emphasis on the risk aspects of the two types of plans for the individual, are examined by Zvi Bodie, Alan J. Marcus, and Robert C. Merton. In the final paper, pension plans and worker turnover are the focus of the discussion by Edward P. Lazear and Robert L. Moore, who propose pension option value rather than the commonly used accrued pension wealth as a measure of pension value.

In recent years a decline in the labor force participation of older workers has combined with rapid current and projected increases in the number of older Americans, producing major policy debates over looming "crises" in social security and, to a lesser extent, in the private pension system. That private system is playing an increasing role in the support of retired workers and promises to be the subject of increasing scrutiny by economists and policymakers alike. Previous books on private pensions have largely neglected behavioral implications of the features of pension plans. The papers in this volume, developed from material presented at a recent National Bureau of Economic Research conference, address two aspects of the relation between varieties of labor coverage and participation in the labor force. First, age at retirement may be correlated with kind of pension coverage. The papers, in fact, provide strong evidence that individual decisions about when to retire are directly influenced by pension options. Second, pension plans usually impose a high cost on workers who change jobs, which suggests that pension coverage reduces instances of job change. Pensions, Labor, and Individual Choice quantifies these correlations and proposes a conceptual framework within which to view them.

In the past several decades, pension plans have become one of the most significant institutional influences on labor and financial markets in the U.S. In an effort to understand the economic effects of this growth, the National Bureau of Economic Research embarked on a major research project in 1980. Issues in Pension Economics, the third in a series of four projected volumes to result from thsi study, covers a broad range of pension issues and utilizes new and richer data sources than have been previously available. The papers in this volume cover such issues as the interaction of pension-funding decisions and corporate finances; the role of pensions in providing adequate and secure retirement income, including the integration of pension plans with social security and significant drops in the U.S. saving rate; and the incentive effects of pension plans on labor market behavior and the implications of plans on labor market behavior and the implications of plans for different demographic groups. Issues in Pension Economics offers important empirical studies and makes valuable theoretical contributions to current thinking in an area that will most likely continue to be a source of controversy and debate for some time to come. The volume should prove useful to academics and policymakers, as well as to members of the business and labor communities.

As America's population ages, economic research related to the elderly becomes increasingly important to public policy. Frontiers in the Economics in Aging directs attention to four topics: the role of retirement accounts, such as IRAs and 401(k)s in personal saving; the economics of health care; new advances in research methodology; and aging in relation to inequality. Some of the issues analyzed within these topics are the implications of rising personal retirement saving in recent years, how health and health insurance affect labor supply, and the effects of pensions on the distribution of wealth. David Wise's lucid introduction provides an overview of each paper. In addition to this book's appeal for specialists and microeconomists, it offers immediately practical ideas and methods for shaping public policy. In fact, one of the papers in this volume, "The Taxation of Pensions: A Shelter Can Become a Trap," helped to spur new legislation that reformed laws on pension distribution.