- Journal Details
- First Published
- 30 Mar 2015
- Publication timeframe
- 4 times per year
- Open Access
Controlling a demographic wave in defined contribution pension systems
Page range: 1 - 18
In several developed countries, the baby boomers will come to retire in the next decades. This problem will threaten the sustainability and the intergenerational equity of mandatory pay-as-you-go pension systems because they will have to drain the “demographic wave” of retirees with a relatively small number of contributors. In this paper, we give the operating method developed on the basis of a general principle, which a defined contribution pension system, in a state of stable sustainability, should adopt to control these issues in the presence of a demographic wave. In the theoretical profile, our approach breaks and overcomes the classical juxtaposition between funded and pay-as-you-go pension schemes, carrying out the integration of the two financial methods.
- Mandatory pension system control
- baby boom demographic wave
- logical sustainability
- intergenerational equity
- Open Access
Duplex selections, equilibrium points, and viability tubes
Page range: 19 - 33
Existence of viable trajectories to nonautonomous differential inclusions are proven for time-dependent viability tubes. In the convex case we prove a double-selection theorem and a new Scorza-Dragoni type lemma. Our result also provides a new and palpable proof for the equilibrium form of Kakutani’s fixed point theorem.
- viable trajectories
- sleek tubes
- tangential conditions
- continuous selections and quasi-selections
- Open Access
Personalised Hiking Time Estimation
Page range: 35 - 42
There are numerous attempts to estimate hiking time since the age of the ancient Roman Empire, the new digital era calls for more precise and exact solutions to be implemented in mobile applications. The importance of the topic lies in the fact that route planning algorithms and shortest path problems apply time estimations as cost functions. Our intention is to design a hiking time estimation method that accounts for terrain circumstances as well as personal factors, while the level of accuracy and the simplicity of the algorithm should enable the solution to be utilised in the practice. We refine Tobler’s earlier results to estimate a relation between terrain steepness and hiker’s velocity. Later we use fitted curve to design our novel, personalised hiking time estimation method.
- Time estimation
- Operations research
- Model Construction and Estimation
- Forecasting and Prediction Methods
- Open Access
A simple model of production and trade in an oligopolistic market: back to basics
Page range: 43 - 80
We provide a two good model of oligopolistic production and trade with one good being commodity money. There is the usual demand function of the consumers for the produced good that producer-sellers face. Each seller is a budget constrained preference maximizer and derives utility (or satisfaction) from consuming bundles comprising commodity money and the produced good. We define a competitive equilibrium strategy profile and a Cournotian equilibrium and show that under our assumptions both exist. We further show that at a competitive equilibrium strategy profile, each seller maximizes profits given his own consumption of the produced good and the price of the produced good, the latter being determined by the inverse demand function. Similarly we show that at a Cournotian the sellers are at a Cournot equilibrium given their own consumption of the produced good. Assuming sufficient differentiability of the cost functions we show that at a competitive equilibrium each seller either sets price equal to marginal cost or exhausts his capacity of production; at a Cournotian equilibrium each seller either sets marginal revenue equal to marginal cost or exhausts his capacity of production. We also study the evolution of Cournotian strategies as the sellers and buyers are replicated. As the number of buyers and sellers go to infinity any sequence of interior symmetric Cournotian equilibrium strategies admits a convergent subsequence, which converges to an interior symmetric competitive equilibrium strategy. In a final section we discuss the Bertrand Edgeworth price setting game and show that a Bertrand Edgeworth equilibrium must be a derived from a competitive equilibrium price. Here we show that if at a symmetric competitive equilibrium, the sellers consume positive quantities of the produced good then the competitive equilibrium cannot be a Bertrand Edgeworth equilibrium. Thus, if at all symmetric competitive equilibria the sellers consume positive amounts of the produced good, then a Bertrand Edgeworth equilibrium simply does not exist.
- competitive equilibrium
- Cournotian equilibrium
- asymptotic convergence
- Open Access
The optimal rate of return for defined contribution pension systems in a stochastic framework
Page range: 81 - 99
This paper deals with the problem of the optimal rate of return to be paid by a defined contribution pension system to its participants’ savings, namely the rate that achieves the goal of the most favorable returns on their contributions jointly with the sustainability of the pension system.
We consider defined contribution pension systems provided with a funded component, and for their study we use the “theory of the logical sustainability of pension systems” already developed in several previous works. In this paper, we focus on pension systems in a demographically stable state, whereas the productivity of the active participants and the financial rate of return on the pension system’s fund, rates that constitute the “ingredients” of the optimal rate of return on contributions, are modeled by two stochastic processes.
We show that the decisional rule defining the optimal rate of return on contributions is optimal in the sense that it is effective in terms of sustainability, and also efficient in the sense that if the system pays to its participants’ contributions a rate of return that is either higher or lower than the one provided by the rule, then the pension system becomes unsustainable or overcapitalized, respectively.
- defined contribution pension system
- logical sustainability model
- stochastic rates
- optimal rate of return