Public Pension Research
NCPERS regularly produces leading research providing key insights on issues impacting public pensions, solutions for policy-related challenges, and more. Browse our research below, or click the links to jump to an area of focus:
- Pension Funding & Long-Term Sustainability
- Economic Impact
- Healthcare and Retiree Medical Trusts
- Pension Accounting & Finance
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Featured Research:
The Hidden Costs of Pension Reforms: Rising Income Inequality, Lagging Economic Growth
This 2024 study from NCPERS examines the relationship between pension reforms (consisting primarily of benefit reductions) in both the private and public sector, income inequality, and economic growth. Analysis finds that the shift away from pensions to 401(k)-style plans has increased income inequality, and policies that reduce pension benefits may end up costing more due to the dynamic interrelationship between pension reforms, income inequality, the economy, and market returns.
The Top 10 Advantages of Maintaining Defined-Benefit Pension Plans
This research brief looks at the many benefits of pensions in a direct comparison to defined-contribution plans. The study delves into how defined benefit and defined contribution plans work and discusses how to mitigate risk.
Pension Funding & Long-Term Sustainability
Measuring Public Pension Health: New Metrics and New Approaches. This report identifies three key metrics to help guide decisions by managers and policy makers. The centerpiece is a Pension Funding Scorecard that presents a standard and succinct set of key metrics that reflect not only financial condition, but policies in place and management actions.
Beyond Funding Ratios: Five Ways to Assess the Health of Public Pensions. This Research Series paper proposes five ways, including a few innovative ones, to assess the health of public pensions. New assessment methods are desirable because current approaches are failing to deliver reliable information on and insights into public pension funding that are needed to shape public policy.
Ten Ways to Close Public Pension Funding Gaps. What are the options when a public pension funding gap develops? This 2020 report identifies ten policy solutions to help close the gap and promote long-term sustainability.
Enhancing Sustainability of Public Pensions. Lead researcher Michael Kahn introduces an innovative approach—“sustainability valuation”—redefining how we evaluate pension sustainability. This approach, rooted in economic theory, redefines fiscal stability by examining the ratio between unfunded liabilities and the economy.
Don’t Dismantle Public Pensions Because They Aren’t 100 Percent Funded. The purpose of this study is to examine what determines the ability of a pension system to pay annual benefits. Using empirical data from 1993 to 2016, we find that pension funding levels are not the key factor explaining the ability to pay annual benefits.
Ensuring Funding for Public Pensions: A Guide to Raising Revenues and Closing Tax Loopholes. Meeting future pension plan obligations and commitments to other public services will be much easier if states have an adequate and growing tax revenue structure. This report examines some of the drivers behind state tax growth in the past and makes some observations and recommendations for the future.
Auto-Triggers: Exploring Their Potential in the Public Pension Ecosystem. This paper examines an alternative approach that uses auto-triggers to surmount the shortcomings of individual 401(k)-style plans by incorporating into the array of retirement options a new kind of plan known as the collective defined-contribution (CDC) plan.
Economic Impact Research
Unintended Consequences: How Scaling Back Public Pensions Puts Government Revenues at Risk. Analyzing how investment and spending connected to pension funds impacts state and local economies and revenues, this landmark study finds that public pension funds help power the U.S. economy. In 2018, they generated $179.4 billion more in state and local government revenues than taxpayers put in.
Do Pension Expenditures Impact Education Spending? Critics maintain that pension expenditures by state and local governments are crowding out other important forms of spending—notably, education funding. This 2023 research study examines state-by-state historical data on pension contributions, education expenditures, revenues, and the economy, finding that the crowding-out effect simply isn’t occurring.
Public Pensions Are a Good Deal for Taxpayers. This 2017 report examines the positive impacts of public pensions, looking at the impact on taxpayers and the economy more broadly. We found that if governments continue to dismantle public pensions they will inflict $3 trillion in economic damage by 2025.
Economic Loss: The Hidden Cost of Prevailing Pension Reforms. This 2017 study looks at the economic damage that would result from replacing public pensions with 401(k)-style plans and explores strategies to fund pensions without dismantling them.
Healthcare and Retiree Medical Trusts
Creating a Retiree Medical Trust: A Fresh Look at a Proven Solution. Like pensions, retiree medical trusts harness the power of collective investing to provide income in retirement—in this case, to defray medical costs. This report offers an introduction to the purpose, operation, and benefits of an RMT.
Financing Retiree Health Strategies in the Public Sector. This white paper discusses the current state of retiree health coverage in the public sector, exploring the varying strategies available for offering alternative or enhanced retiree health care financing arrangements.
Pension Accounting & Finance
The Case for New Pension Accounting Standards. This report presents a critique of the existing accounting rules for public pension funds as formulated in the various statements of the Governmental Accounting Standards Board (GASB), and some suggestions about different directions that might help policy makers make better decisions about the pension plans they manage.