Online After Lunch Taskforce Meeting: Prudent investment for agents with unstable preferences in an uncertain world
Netspar organizes this online After Lunch Taskforce Meeting for partners and employees of partners. Researchers will outline their latest retirement research and then receive feedback and answer questions. It is just another way we bring science, academics, and professional practice closer together.
In this online After Lunch Taskforce Meeting by Nikolaus Schweizer (Tilburg University) you will learn more about prudent investment for agents with unstable preferences in an uncertain world.
Questions and input on this ongoing research are welcome.
This is an English-speaking event.
One of the challenges that comes with the new Dutch pension law is the elicitation and processing of participants’ risk preferences and risk capacities. In this research project, we provide some answers to two closely related questions: How much personalization is necessary to reach satisfactory results? How bad is it really if for some reason a participant’s investment strategy does not match their preferences exactly? Reasons for such a mismatch include many different things: changes in preferences or household earnings, measurement errors, but also the grouping of slightly different participants within a “risk class”. We find that life-cycle utility is surprisingly robust to variations of the investment strategy. An important source of exceptions are unexpected drops in pension accrual which could, e.g., be due to disability, unemployment or unplanned part-time work.
