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Labour Unemployment Insurance and Pension Asset Allocations
Yina Liang 
,
Paraskevi Vicky Kiosse,
Monika Tarsalewska
,
Paraskevi Vicky Kiosse,
Monika Tarsalewska
British Journal of Management, Pages: 1 - 16
Swansea University Author:
Yina Liang
Full text not available from this repository: check for access using links below.
DOI (Published version): 10.1111/1467-8551.12881
Abstract
This paper examines the effect of unemployment risk on pension investment decisions of defined benefit pension plans. In particular, we examine whether unemployment insurance benefits affect pension investment risk. Using fixed‐effects and difference‐in‐difference analyses, we find evidence that fir...
| Published in: | British Journal of Management |
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| ISSN: | 1045-3172 1467-8551 |
| Published: |
Wiley
2024
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| Online Access: |
Check full text
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| URI: | https://cronfa.swan.ac.uk/Record/cronfa68377 |
| Abstract: |
This paper examines the effect of unemployment risk on pension investment decisions of defined benefit pension plans. In particular, we examine whether unemployment insurance benefits affect pension investment risk. Using fixed‐effects and difference‐in‐difference analyses, we find evidence that firms take higher pension investment risk by investing more heavily in equities after unemployment insurance benefit increases. These results are consistent with the notion that firms undertake more risk when the costs of unemployment decrease. The findings are robust to a number of sensitivity tests, including a falsification test to examine the timing of the relationship between the riskiness of the pension portfolio and unemployment insurance benefits, a 3‐year window, alternative matching methods and removing firms that operate in geographically dispersed industries. Additional analyses suggests that the findings are more pronounced for firms with skilled labour and high labour intensity, while they are less pronounced when the risk of layoffs is high, in less competitive industries and highly unionized firms. |
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| College: |
Faculty of Humanities and Social Sciences |
| Start Page: |
1 |
| End Page: |
16 |