The Role of Real Annuities and Indexed Bonds in an Individual Accounts Retirement Program

We explore four issues concerning annuitization options that retirees might use in the decumulation phase of an individual accounts' retirement saving system. First, we investigate the operation of both real and nominal annuity individual annuity markets in the United Kingdom. The widespread availability of real annuities in the U.K. dispels the argument that private insurance markets could not, or would not, provide real annuities to retirees. Second, we consider the current structure of two inflation-linked insurance products available in the United States, only one of which proves to be a real annuity. Third, we evaluate the potential of assets such as stocks, bonds, and bills, to provide retiree protection from inflation. Because equity real returns have been high over the last seven decades, a retiree who received income linked to equity returns would have fared very well on average. Nevertheless we cast doubt on the inflation insurance' aspect of equity, since this is mainly due to stocks' high average return, and not because stock returns move in tandem with inflation. Finally, we use a simulation model to assess potential retiree willingness to pay for real, nominal, and variable payout equity-linked annuities. For plausible degrees of risk aversion, inflation protection appears to have only modest value. People would be expected to value a variable payout equity-linked annuity more highly than a real annuity because the additional real returns associated with common stocks more than compensate for the volatility of prospective payouts. These finding are germane to concerns raised in connection with Social Security reform plans that include individual accounts.

Taxing Retirement Income: Nonqualified Annuities and Distributions from Qualified Accounts

This paper explores the current tax treatment of non-qualified immediate annuities and distributions from tax-qualified retirement plans in the United States. First, we describe how immediate annuities held outside retirement accounts are taxed. We conclude that the current income tax treatment of annuities does not substantially alter the incentive to purchase an annuity rather than a taxable bond. We nevertheless find differences across different individuals in the effective tax burden on annuity contracts. Second, we examine an alternative method of taxing annuities that would avoid changing the fraction of the annuity payment that is included in taxable income as the annuitant ages, but would still raise the same expected present discounted value of revenues as the current income tax rule. We find that a shift to a constant inclusion ratio increases the utility of annuitants, and that this increase is greater for more risk averse individuals. Third, we examine how payouts from qualified accounts are taxed, focusing on both annuity payouts and minimum distribution requirements that constrain the feasible time path of nonannuitized payouts. We describe briefly the origins and workings of the minimum distribution rules and we also provide evidence on the fraction of retirement assets potentially affected by these rules.

Framing Effects and Expected Social Security Claiming Behavior

Eligible participants in the U.S. Social Security system have the ability to claim benefits anytime between ages 62 and 70, with the level of benefit being actuarially adjusted based on the date of claiming. This project shows that individual intentions with regard to Social Security claiming age are sensitive to the manner in which the early versus late claiming decision is framed. Using an experimental design that alters the manner in which the implications of Social Security benefits are framed, we find evidence that the use of a “break-even analysis” has the very strong effect of encouraging individuals to claim early. We show that individuals are more likely to report that they will delay claiming when later claiming is framed as a gain and when the information provides an anchoring point at older, rather than younger, ages. We also provide evidence that females, individuals with credit card debt, and individuals with lower expected benefits are more strongly influenced by framing. The finding that expected claiming decisions can be significantly altered by the framing of information suggests that individuals may not be making fully rational optimizing choices when it comes to choosing a claiming date

History of Whaling and Estimated Kill of Right Whales, Balaena glacialis, in the Northeastern United States, 1620–1924

This study, part of a broader investigation of the history of exploitation of right whales, Balaena glacialis, in the western North Atlantic, emphasizes U.S. shore whaling from Maine to Delaware (from lat. 45°N to 38°30'N) in the period 1620–1924. Our broader study of the entire catch history is intended to provide an empirical basis for assessing past distribution and abundance of this whale population. Shore whaling may have begun at Cape Cod, Mass., in the 1620’s or 1630’s; it was certainly underway there by 1668. Right whale catches in New England waters peaked before 1725, and shore whaling at Cape Cod, Martha’s Vineyard, and Nantucket continued to decline through the rest of the 18th century. Right whales continued to be taken opportunistically in Massachusetts, however, until the early 20th century. They were hunted in Narragansett Bay, R.I., as early as 1662, and desultory whaling continued in Rhode Island until at least 1828. Shore whaling in Connecticut may have begun in the middle 1600’s, continuing there until at least 1718. Long Island shore whaling spanned the period 1650–1924. From its Dutch origins in the 1630’s, a persistent shore whaling enterprise developed in Delaware Bay and along the New Jersey shore. Although this activity was most profi table in New Jersey in the early 1700’s, it continued there until at least the 1820’s. Whaling in all areas of the northeastern United States was seasonal, with most catches in the winter and spring. Historically, right whales appear to have been essentially absent from coastal waters south of Maine during the summer and autumn. Based on documented references to specific whale kills, about 750–950 right whales were taken between Maine and Delaware, from 1620 to 1924. Using production statistics in British customs records, the estimated total secured catch of right whales in New England, New York, and Pennsylvania between 1696 and 1734 was 3,839 whales based on oil and 2,049 based on baleen. After adjusting these totals for hunting loss (loss-rate correction factor = 1.2), we estimate that 4,607 (oil) or 2,459 (baleen) right whales were removed from the stock in this region during the 38-year period 1696–1734. A cumulative catch estimate of the stock’s size in 1724 is 1,100–1,200. Although recent evidence of occurrence and movements suggests that right whales continue to use their traditional migratory corridor along the U.S. east coast, the catch history indicates that this stock was much larger in the 1600’s and early 1700’s than it is today. Right whale hunting in the eastern United States ended by the early 1900’s, and the species has been protected throughout the North Atlantic since the mid 1930’s. Among the possible reasons for the relatively slow stock recovery are: the very small number of whales that survived the whaling era to become founders, a decline in environmental carrying capacity, and, especially in recent decades, mortality from ship strikes and entanglement in fishing gear

Framing Effects and Expected Social Security Claiming Behavior

Eligible participants in the U.S. Social Security system may claim benefits anytime from age 62-70, with benefit levels actuarially adjusted based on the claiming age. This paper shows that individual intentions with regard to Social Security claiming ages are sensitive to how the early versus late claiming decision is framed. Using an experimental design, we find that the use of a “break-even analysis” has the very strong effect of encouraging individuals to claim early. We also show that individuals are more likely to report they will delay claiming when later claiming is framed as a gain, and when the information provides an anchoring point at older, rather than younger, ages. Moreover, females, individuals with credit card debt, and workers with lower expected benefits are more strongly influenced by framing. We conclude that some individuals may not make fully rational optimizing choices when it comes to choosing a claiming date.

Genetic mapping and legume synteny of aphid resistance in African cowpea (Vigna unguiculata L. Walp.) grown in California.

The cowpea aphid Aphis craccivora Koch (CPA) is a destructive insect pest of cowpea, a staple legume crop in Sub-Saharan Africa and other semiarid warm tropics and subtropics. In California, CPA causes damage on all local cultivars from early vegetative to pod development growth stages. Sources of CPA resistance are available in African cowpea germplasm. However, their utilization in breeding is limited by the lack of information on inheritance, genomic location and marker linkage associations of the resistance determinants. In the research reported here, a recombinant inbred line (RIL) population derived from a cross between a susceptible California blackeye cultivar (CB27) and a resistant African breeding line (IT97K-556-6) was genotyped with 1,536 SNP markers. The RILs and parents were phenotyped for CPA resistance using field-based screenings during two main crop seasons in a 'hotspot' location for this pest within the primary growing region of the Central Valley of California. One minor and one major quantitative trait locus (QTL) were consistently mapped on linkage groups 1 and 7, respectively, both with favorable alleles contributed from IT97K-556-6. The major QTL appeared dominant based on a validation test in a related F2 population. SNP markers flanking each QTL were positioned in physical contigs carrying genes involved in plant defense based on synteny with related legumes. These markers could be used to introgress resistance alleles from IT97K-556-6 into susceptible local blackeye varieties by backcrossing

Using mobile technology to engage sexual and gender minorities in clinical research.

IntroductionHistorical and current stigmatizing and discriminatory experiences drive sexual and gender minority (SGM) people away from health care and clinical research. Being medically underserved, they face numerous disparities that make them vulnerable to poor health outcomes. Effective methods to engage and recruit SGM people into clinical research studies are needed.ObjectivesTo promote health equity and understand SGM health needs, we sought to design an online, national, longitudinal cohort study entitled The PRIDE (Population Research in Identity and Disparities for Equality) Study that enabled SGM people to safely participate, provide demographic and health data, and generate SGM health-related research ideas.MethodsWe developed an iPhone mobile application ("app") to engage and recruit SGM people to The PRIDE Study-Phase 1. Participants completed demographic and health surveys and joined in asynchronous discussions about SGM health-related topics important to them for future study.ResultsThe PRIDE Study-Phase 1 consented 18,099 participants. Of them, 16,394 provided data. More than 98% identified as a sexual minority, and more than 15% identified as a gender minority. The sample was diverse in terms of sexual orientation, gender identity, age, race, ethnicity, geographic location, education, and individual income. Participants completed 24,022 surveys, provided 3,544 health topics important to them, and cast 60,522 votes indicating their opinion of a particular health topic.ConclusionsWe developed an iPhone app that recruited SGM adults and collected demographic and health data for a new national online cohort study. Digital engagement features empowered participants to become committed stakeholders in the research development process. We believe this is the first time that a mobile app has been used to specifically engage and recruit large numbers of an underrepresented population for clinical research. Similar approaches may be successful, convenient, and cost-effective at engaging and recruiting other vulnerable populations into clinical research studies

Is Fed Policy Still Relevant for Investors?

Using 38 years of data, we show that U.S. monetary policy has had, and continues to have, a strong relationship with security returns. Specifically, we find that U.S. stock returns are consistently higher and less volatile during periods when the Federal Reserve is following an expansive monetary policy. Further, firms considered to be more sensitive to changes in monetary conditions, such as small firms and cyclicals, exhibit monetary-policy-related return patterns that are much more pronounced than average. Lastly, the influence of U.S. monetary policy is shown to be a global phenomenon, as international indices have return patterns similar to those for the U.S. market. Overall, our evidence suggests that investment professionals should continue to use monetary conditions when performing fundamental analysis of both U.S. and international securities