Home Subscribe Login Contact Us Search Journal Articles PFM RSS Feed

PFM Articles Search Journal Articles

Stand-alone Article: Defined Benefit Public Pension Funding Determinants and Consequences: A Review of the Literature

PFM, Vol. 20 No. 2, (2021)

Public employee pension funding in the United States continues to be a topic of interest to both practitioners and researchers. Early works in this area date back to Mumy (1978). However, it wasn’t until the mid-1990s that the stream of research on public pension funding resurfaced. The objective of this essay is to provide an overview of the literature on defined benefit pension funding in the public employee pensions sector in the United States over the approximately past 20 years and to highlight research areas where there may be gaps. Empirical research on defined benefit pension funding has predominantly focused on the antecedents or determinants of the pension funded status, motivated in large part by the magnitude of underfunding. These studies are often concentrated on a subset of (typically) larger, state-wide systems, given existing data limitations. Thus, this essay outlines how research has evolved and aggregates the works on determinants of defined benefit pension fund-ing at three levels: states’ plan level, local level across states, and local and/or specific state level. It also presents the research available on the consequences of defined benefit pension funding. This review reveals limited research on the consequences of pension funding and high-lights opportunities for related future empirical research in this domain.
Keywords: public employee pensions, pension funding determinants, pension funding consequences

Subscribers: Login to read this article

Guests: Subscribe to PFM, or purchase individual article access for $10.
The article is not available for automatic download. We will email the article to you as a PDF file upon receiving your payment, typically within 24 hours.