Is market valuation fair?
Session 1 - Recent developments in pension finance and actuarial science
10.00 - 11.00 Lecture I.2 Jon Exley (Barclays Capital)
The application of market, or "fair", values to the pensions world has coincided with some dramatic changes in attitudes towards corporate pension provision. This paper analyses the philosophy of market valuation and argues that economic welfare should be enhanced by agents such as corporate managers applying this more rigorous discipline to decision making on behalf of their principals.
Furthermore, it is suggested that the same market valuation techniques could usefully be applied by public policy makers. The paper goes on to advance the proposition that unbiased application of this "fair value" approach appears to offer rather overwhelming evidence in favour of existing pension arrangements more often destroying, rather than enhancing, economic welfare. By contrast, common and ingenious arguments in support of the status quo are presented as somewhat tenuous, over engineered, or easily dismissed through the existence of straightforward counter arguments and examples of more direct ways of achieving similar, or far superior, results.
Abstracts
- Lecture I.1 - Luis Viceira
- Lecture I.2 - Jon Exley
- Lecture I.3 - Jeremy Gold
- Lecture II.1 - Raimond Maurer
- Lecture II.2 - Matthias Weiss
- Lecture II.3 - David Blake
- Lecture III.1 - Richard Hinz
- Lecture III.2 - Keith Ambachtsheer
- Lecture III.3 - Zvi Bodie
- Lecture III.4 - Lans Bovenberg
- Key note speech - Lucas Papademos
