World Bank2012-08-132012-08-132005-01https://hdl.handle.net/10986/11238Pension, to most people, implies a regular payment from a specific age-such as retirement-until death. Individual retirement accounts are a vehicle for retirement savings but they do not become a pension in the conventional sense of the word until they are converted to an 'annuity'. How much and what type of annuitization should be mandated are key policy questions facing reformers. Economists believe that annuities can make people better off. The intuition is straightforward. Life expectancy is normally uncertain. So people would have to spend accumulated wealth slowly after retirement to ensure an adequate income should they live a long time. This kind of self-insurance is costly because it increases the chances that people will consume less than they could have if they knew when they were going to die. This cost can be reduced with annuities, which pool risk across individuals.CC BY 3.0 IGOADVERSE EFFECTSADVERSE SELECTIONANNUITIESANNUITIES MARKETSANNUITYANNUITY MARKETSANNUITY PAYMENTSANNUITY PROVIDERSANNUITY PROVISIONANNUITY RATESBENEFIT LEVELCAPITAL REQUIREMENTSCENTRAL BANKCOMPETITIVENESSCOUNTRY COMPARISONSCOVERAGEDISCOUNT RATEEARNINGS REPLACEMENTECONOMIC RESEARCHECONOMISTSEMPIRICAL STUDIESFINANCE MINISTRIESFUTURE PAYMENTSGOVERNMENT BONDSGOVERNMENT INTERVENTIONHEALTH INSURANCEHUMAN DEVELOPMENTINDEXATIONINDEXED ANNUITYINDEXED BONDSINDIVIDUAL ACCOUNT SYSTEMSINDIVIDUAL ACCOUNTSINDIVIDUAL ACCOUNTS SYSTEMINDIVIDUAL RETIREMENT ACCOUNTSINFLATIONINFORMAL SECTORINHERITANCEINSURANCE COMPANIESINSURANCE INDUSTRYINSURERSINTEREST RATEINTEREST RATESINVESTMENT RETURNSLIFE ANNUITIESLIFE ANNUITYLIFE EXPECTANCIESLIFE EXPECTANCYLIFE INSURANCELIFE INSURANCE COMPANIESLIQUID ASSETSLIQUIDITYLIVING STANDARDSLONGEVITY INSURANCELONGEVITY RISKMACROECONOMIC STABILIZATIONMANDATORY SYSTEMMORAL HAZARDMORAL HAZARD PROBLEMMORTALITY TABLESPATERNALISMPENSION FUNDPENSION FUNDSPENSION REFORMPENSION REFORMSPENSION SCHEMESPENSION SYSTEMPENSION SYSTEMSPENSIONERSPENSIONSPOLITICAL ECONOMYPROGRAMSPUBLIC POLICYPURCHASING POWERREPLACEMENT RATERESERVESRETIREMENTRETIREMENT AGERETIREMENT INCOMERETIREMENT SAVINGSRURAL COMMUNITIESSAFETY NETSSAVINGS ACCOUNTSSAVINGS BEHAVIORSCHEDULED WITHDRAWALSSOCIAL PROTECTIONSOCIAL SAFETY NETSUPERVISORY AUTHORITIESTRANSACTION COSTSVARIABLE ANNUITIESWEALTHWELFARE GAINSWorld Bank10.1596/11238