Life-Cycle Conference

CONFERENCE CONTENT   Wednesday, Oct. 22   Thursday, Oct. 23   Friday, Oct. 24

7:45 AM Continental Breakfast and Registration
8:30-8:45 AM Opening Remarks
Louis E. Lataif, Allen Questrom Professor and Dean of the School of Management
8:45-10:15 AM The Economic Theory of Consumption and Wealth Management in Retirement

Robert Reitano, Professor of the Practice in Finance at International Business School, Brandeis University
Speaker: Eytan Sheshinski, Professor, The Hebrew University of Jerusalem   Presentation

Discussants: David Babbel, Professor of Finance and Insurance, Wharton School, University of Pennsylvania   Presentation

Jonathan Treussard, Associate with Risk and Performance Department, Ziff Brothers Investment   Presentation

Long ago economic theorists concluded that consumption annuities are the efficient form for retirement benefits to take in a "frictionless" economic environment with complete markets for all contingencies. In the real world, there are many frictions, markets are incomplete, and annuities represent only a small fraction of private retirement assets. Moreover, consumers and many financial advisors show strong resistance to annuitizing their accumulated savings. This session will focus on whether the financial innovations of recent years now make it feasible to improve social welfare by creating new types of retirement contracts. Among the possible innovations to be discussed are contracts that bundle longevity and health insurance together, and life annuities that give retirees options to retain some control over their wealth.
10:15-10:45 AM Break
10:45 AM-12:15 PM Health Care and Assisted Living for the Elderly - Panel Discussion

Laurence Kotlikoff, Professor, Boston University, Research Associate of the National Bureau of Economic Research and President of Economic Security Planning, Inc.
Panelists: Robert Butler, President & CEO, International Longevity Center - USA
Amy Finkelstein, Professor of Economics, Massachusetts Institute of Technology   Presentation
Jonathan Skinner, John Sloan Dickey Third Century Chair of Economics, Dartmouth College   Presentation
This panel of experts will discuss the current status of the health and fitness of the elderly population in the United States and the prospects for the future. First, what can today's elderly expect in terms of living on their own, or in independent living, assisted living, or in nursing homes? And who pays for this care -- private saving, Medicaid, or Medicare? Second, how much do today's Baby Boomers need to save against growing health care costs? And do they need to save against contingencies such as a lengthy stay in a nursing home? A key factor in answering this latter question is what is the quality of institutional care (particularly for Medicaid patients) and how much support might come from children of the elderly. Third, what are the prospects for long-term care insurance -- how good are the policies and how can long-term care be improved? Finally, what are some of the imaginative innovations in residential arrangements (such as the naturally occurring retirement communities) and their prospects for diffusion across the U.S.?
12:15-1:30 PM Lunch
1:30-3:00 PM Phased Retirement - Panel Discussion

Robert Triest, Senior Economist & Policy Advisor, Federal Reserve Bank of Boston
Panelists: Anna Rappaport, President, Anna Rappaport Consulting
Paper: Why Phased Retirement? - the Case for Phased Retirement and Some Policy Recommendations   Presentation

Teresa Ghilarducci
, Schwartz Chair in Economic Policy and Director of SCEPA at the New School for Social Research   Paper   Presentation

Alicia Munnell, Peter F. Drucker Professor of Management Sciences, Boston College
Paper: Is Phased Retirement the Path to Retirement Income Security?
Among the most important factors in determining how much one needs to save for retirement are the age at which one plans to retire from full-time work and the extent to which one continues to work part-time after that. Delaying retirement allows one to put aside more savings, and also reduces the number of years over which one must stretch those savings. Extending one's labor force participation beyond retirement from a full-time career job, whether through phased retirement from that job or through a new flexible "bridge job," allows one to supplement retirement income and reduces the amount of savings needed to maintain pre-retirement living standards. The panel will address the role that delayed and phased retirement should-and is likely to-play in households' life cycle planning.
3:00-3:30 PM Break
3:30-5:00 PM How Older People Behave

Bill Samuelson, Professor, Boston University School of Management   Presentation
Panelists: Richard Zeckhauser, Frank Plumpton Ramsey Professor of Political Economy, John F. Kennedy School of Government, Harvard University
David Laibson, Professor of Economics, Harvard University  Presentation
Dallas Salisbury, President & CEO, Employee Benefit Research Institute   Presentation

Jason Zweig, Personal finance columnist for The Wall Street Journal.
Making prudent financial decisions for retirement is fraught with difficulties. This session focuses on both pre-retirement and post-retirement behavior - noting the common mistakes and decision pitfalls of individuals and also some of the limitations of professional financial advice. Among the questions examined: What innovations can improve financial planning for retirement? How active a role (heavy a burden) should the individual bear? Would paternalistic guidelines or constraints induce better decisions? What is the division of labor between retirement "ends" (the individual's stated goals and preferences) and financial "means"? What role should public policy play?
5:00-6:30 PM Cocktail Reception in 7th Floor Alumni Lounge
6:30-9:00 PM Dinner with After-dinner discussion:
What Retirement Means to Me (click for video)

Moderator: Paul Solman, Business & Economics Correspondent, PBS The Newshour
Participants: Paul Samuelson, Alfred Nobel Memorial Prize in Economic Sciences Laureate
Robert Solow, Alfred Nobel Memorial Prize in Economic Sciences Laureate
Robert Merton, Alfred Nobel Memorial Prize in Economic Sciences Laureate
Our panel of senior economists will respond to questions posed by PBS Newshour economics correspondent Paul Solman and by the audience. Here are the first four questions:
  • When do you intend to retire?
  • How do you allocate your retirement assets?
  • Do you think we face a retirement saving crisis in the US?
  • What advice about retirement planning would you give to the next generation of Americans?

  • Carol Waldvogel
    T: 617.353.4248