Desde la creación del sistema en 1981, las Administradoras de Fondos de Pensiones (AFPs) no han podido elegir libremente sus carteras de inversión. Esto es producto de una estricta regulación de las inversiones, específicamente a través de restricciones cuantitativas: límites. Uno de los elementos importantes en el diagnóstico implícito en esta regulación es que el mercado de capitales en Chile, a...
Una de las consecuencias más importantes de la reforma chilena de pensiones realizada a principios de los 80s fue la transferencia de una porción significativa del riesgo asociado al financiamiento de las pensiones, desde el Estado, hacia los afiliados del nuevo sistema obligatorio. En este artículo se desarrolla un marco analítico que permite incorporar el comportamiento del administrador de...
La Reforma Previsional recientemente aprobada introduce una serie de medidas que aumentan la competitividad con que opera la industria de AFP. Este artículo resume el análisis realizado en la elaboración y diseño de tales medidas, partiendo por un diagnóstico acabado del nivel de competencia de la industria de Administradoras de Fondos de Pensiones (AFP), y que incluye una descripción de su...
In a defined contribution pension system based on individual accounts information is essential, as plan members are responsible for taking actions in order to avoid undesirable low levels of pension income during retirement. In this paper we use a unique natural experiment to analyze the impact of information on savings decisions. In 2005, Pension Fund Administrators started sending out a...
We propose alternative methods to project pension rights and implement them in Chile and Uruguay and partially in Argentina. We use incomplete work histories databases from the social security administrations to project entire lifetime work histories. We first fit linear probability and duration models of the contribution status and dynamic linear models of the income level. We then run Monte...
Este artículo presenta los principales riesgos que se enfrentan en un sistema de capitalización individual y describe la regulación que en el caso de Chile permite mitigarlos. Uno de los principales riesgos que se enfrentan se refiere al de inversión de los fondos, respecto del cual se analiza el sustento que puede tener una estrategia de inversión de ciclo de vida. Al evaluar estas estrategias se...
This paper studies the relation between institutional investors and capital market development by analyzing unique data on monthly asset-level portfolio allocations of Chilean pension funds between 1995 and 2005. The results depict pension funds as large and important institutional investors that tend to hold a large amount of bank deposits, government paper, and short-term assets; buy and hold...
Emerging economies have tried to promote long-term debt because it reduces maturity mismatches and the probability of crises. This paper uses unique evidence from the leading case of Chile to study to what extent domestic institutional investors hold longterm instruments. We compare monthly asset-level portfolios of Chilean institutional investors (mutual funds, pension funds, and insurance...
In 1981 Chile was the first country in the world to privitise its pension system moving from a traditional unfunded pay-as-you-go scheme (PAYG), where benefits are defined ex-ante by a final salary formula, to a Defined Contributions (DC) scheme where each individual's benefit depends entirely on his own pension savings. Individuals in the labour market at the time of the reform were given the...
Chile went through a major pension system reform in 1981, replacing the state managed pay-as-you-go system by a privately-managed fully funded scheme. The reform implied a rather important increase in the net present value of expected pension wealth for most of those who opted-out to the new arrangement. We investigate the extent to which households substitute this increase by decreasing...
