Which individuals make active investment decisions in the new Swedish pension system?

STEFAN ENGSTRÖM; ANNA WESTERBERG

doi:10.1017/S1474747203001331

Abstract

Core share and HTML view are not available for this content. However, as you have access to this content, a full PDF is available via the ‘Save PDF’ action button.

This paper provides a detailed examination of individuals' active participation in a new public and mandatory defined contribution pension system. The new pension system was launched in the fall of 2000 and entitles Sweden's workforce of 4.4 million individuals to invest part of their individual pension account in mutual funds. Our findings show that the system is associated with a reversed investment behavior compared with studies of 401(k) plans; that is, individuals tend to make their own investment decisions. Contrary to US studies, we also find that women and younger individuals are more likely than men and older individuals to make an active investment decision.

Crossref Citations

This article has been cited by the following publications. This list is generated based on data provided by Crossref.

Karlsson, Anders and Norden, Lars L. 2004. Home Sweet Home: Home Bias and International Diversification Among Individual Investors. SSRN Electronic Journal,

Orszag, J. Michael and Orszag, Peter R. 2005. Individual Accounts: Lessons from International Experience. Science, Vol. 309, Issue. 5732, p. 250.

Karlsson, Anders 2006. Time Diversification in Pension Savings. SSRN Electronic Journal,

Massa, Massimo Karlsson, Anders and Simonov, Andrei 2006. Portfolio Choice and Menu Exposure. SSRN Electronic Journal,

Massa, Massimo Karlsson, Anders and Simonov, Andrei 2006. Stock Market Participation and Pension Reform. SSRN Electronic Journal,

Karlsson, Anders and Norden, Lars L. 2006. Benefits of Contribution: Individual Asset Allocation, Diversification and Welfare in a Defined Contribution Pension System. SSRN Electronic Journal,

Ranerup, Agneta 2006. Electronic Markets Connecting Citizens to Pension Reform. Electronic Markets, Vol. 16, Issue. 4, p. 282.

McQueen, Grant Richard and Karlsson, Anders 2007. The Homeboy Bias: Evidence For and Determinants Of. SSRN Electronic Journal,

Palme, Mårten Sundén, Annika and Söderlind, Paul 2007. How Do Individual Accounts Work in the Swedish Pension System?. Journal of the European Economic Association, Vol. 5, Issue. 2-3, p. 636.

Tapia, Waldo and Yermo, Juan 2007. Implications of Behavioural Economics for Mandatory Individual Account Pension Systems. SSRN Electronic Journal,

Hedesström, Ted Martin Svedsäter, Henrik and Gärling, Tommy 2007. Determinants of the use of heuristic choice rules in the Swedish Premium Pension Scheme: An Internet-based survey. Journal of Economic Psychology, Vol. 28, Issue. 1, p. 113.

Christelis, Dimitris Jappelli, Tullio and Padula, Mario 2008. Cognitive Abilities and Portfolio Choice. SSRN Electronic Journal,

Norden, Lars L. 2008. Individual Home Bias, Portfolio Churning and Performance. SSRN Electronic Journal,

Martenson, Rita 2008. Are men better investors than women? Gender differences in mutual fund and pension investments. Journal of Financial Services Marketing, Vol. 13, Issue. 1, p. 72.

Engstrom, Stefan Grottheim, Richard Norman, Peter and Ragnartz, Christian 2008. Alpha-Beta-Separation: From Theory to Practice. SSRN Electronic Journal,

Karlsson, Anders and Norden, Lars L. 2008. Investor Competence, Information, and Investment Activity. SSRN Electronic Journal,

MILONAS, NIKOLAOS T. PAPACHRISTOU, GEORGE A. and ROUPAS, THEODORE A. 2009. Fund management and its effect in the Greek social security system. Journal of Pension Economics and Finance, Vol. 8, Issue. 4, p. 485.

Hohnen, Pernille and Hjort, Torbjörn 2009. ‘Citizens as Consumers’: A Discussion of New Emergent Forms of Marginalisation in the Nordic Welfare States. European Journal of Social Security, Vol. 11, Issue. 3, p. 271.

Palmer, Edward and Larsson, Bo 2010. The Swedish Annuity Market: Where It Is and Where It’s Headed. SSRN Electronic Journal,

Agnew, Julie Richardson 2010. Behavioral Finance. p. 577.

Download full list

Article contents

Which individuals make active investment decisions in the new Swedish pension system?

Abstract

Save article to Kindle

Save article to Dropbox

Save article to Google Drive

Reply to: Submit a response

Your details

You have entered the maximum number of contributors

Conflicting interests