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Impact of Changing Demographics on Prospective Investment Returns

Background and Purpose

In recent years, there has been a significant number of papers that have explored the potential impact of demographic changes on asset values.  However, there is no general agreement on the extent of the impact.

Given the current state of research in this area, the Society of Actuaries Investment Section Council and Committee on Finance Research are interested in further exploration of the potential impact of changing demographics on prospective investment returns.

This request for proposals includes a broad range of possible approaches for conducting the research as described in the Research Objective section. A fundamental consideration in evaluating proposals is a demonstration of the value of the resulting deliverables to members of the Society of Actuaries Investment Section and other financial professionals.

Respondents to this request for proposals are encouraged to review research material the Society of Actuaries has co-sponsored in recent years. This material can be found at: and

Research Objective

The Society of Actuaries Investment Section Council and Committee on Finance Research are seeking researchers to conduct a study related to the impact of changing demographics on prospective investment returns. The following is a list of proposed topics that may be addressed. Respondents are free to focus on one or more of these topics. It is not expected that a proposal would cover all of these.

  1. Literature search and analysis of previously published material on this topic.
  2. Key demographic trends and how they vary around the world including birth, death, net population growth rates and other relevant factors. This can include analyses categorized by socioeconomic tier, the level of homogeneity vs heterogeneity of a country, and environmental impacts such as climate change.
  3. Impact of the Life cycle on economic behavior such as the tendency to save or spend as a function of age; the mix of spending by age; risk appetite by age; and productivity by age.  
  4. Feasibility of using a modeling approach for population forecasting for the purposes of predictions for GDP growth, save/spend ratios; investment asset demand and funds flows; etc. Related to this, what other factors should be taken into account such as political systems, corruption levels and an index of happiness.
  5. Relationship of differing demographic forecasts to prediction of different economic outcomes. Potential factors include slow population growth countries; implications of growing dependency ratios for Japan/Western Europe / US; and whether fast population growth countries have higher GDP or per capita GDP growth.
  6. Relationship of faster/slower population growth rates to risk free interest rate levels. A potential aspect is to assess the relationship of low rates in Japan and Europe to slow population growth.

Note that the above list is not meant to be exhaustive but merely examples of proposed topics that may be researched.


To facilitate the evaluation of proposals, the following information should be submitted:

  1. Resumes of the researcher(s), including any graduate student(s) expected to participate, indicating how their background, education and experience bear on their qualifications to undertake the research. If more than one researcher is involved, a single individual should be designated as the lead researcher and primary contact. The person submitting the proposal must be authorized to speak on behalf of all the researchers as well as for the firm or institution on whose behalf the proposal is submitted.
  2. An outline of the approach to be used (e.g. literature search, model, etc.), emphasizing issues that require special consideration. Details should be given regarding the techniques to be used, collateral material to be consulted, and possible limitations of the analysis.
  3. A description of the expected deliverables and any supporting data, tools or other resources.
  4. Cost estimates for the research, including computer time, salaries, report preparation, material costs, etc. Such estimates can be in the form of hourly rates, but in such cases, time estimates should also be included. Any guarantees as to total cost should be given and will be considered in the evaluation of the proposal. While cost will be a factor in the evaluation of the proposal, it will not necessarily be the decisive factor.
  5. A schedule for completion of the research, identifying key dates or time frames for research completion and report submissions. The Society of Actuaries is interested in completing this project in a timely manner.  Suggestions in the proposal for ensuring timely delivery, such as fee adjustments, are encouraged.
  6. Other related factors that give evidence of a proposer's capabilities to perform in a superior fashion should be detailed.


Selection Process

The Investment Section Council and Committee on Finance Research will appoint a Project Oversight Group (POG) to oversee the project.  The Investment Section Council and Committee on Finance Research are responsible for recommending the proposal to be funded.  Input from other knowledgeable individuals also may be sought, but the Investment Section Council and Committee on Finance Research will make the final recommendation, subject to SOA leadership approval. The SOA's Research Actuary will provide staff actuarial support.


Any questions regarding this RFP should be directed to Steven Siegel SOA Research Actuary (phone: 847-706-3578; email:


Notification Of Intent To Submit Proposal

If you intend to submit a proposal, please e-mail written notification by January 15, 2020 to Barbara Scott


Submission Of Proposal

Please e-mail a copy of the proposal to Barbara Scott

Proposals must be received no later than January 31, 2020. It is anticipated that all proposers will be informed of the status of their proposal by the end of February 2020.

Note: Proposals are considered confidential and proprietary.


The selection of a proposal is conditioned upon and not considered final until a Letter of Agreement is executed by both the Society of Actuaries and the researcher.

The Society of Actuaries reserves the right to not award a contract for this research. Reasons for not awarding a contract could include, but are not limited to, a lack of acceptable proposals or a finding that insufficient funds are available. The Society of Actuaries also reserves the right to redirect the project as is deemed advisable.

The Society of Actuaries plans to hold the copyright to the research and to publish the results with appropriate credit given to the researcher(s).

The Society of Actuaries may choose to seek public exposure or media attention for the research.  By submitting a proposal, you agree to cooperate with the Society of Actuaries in publicizing or promoting the research and responding to media requests.

The Society of Actuaries may also choose to market and promote the research to members, candidates and other interested parties.  You agree to perform promotional communication requested by the Society of Actuaries, which may include, but is not limited to, leading a webcast on the research, presenting the research at an SOA meeting, and/or writing an article on the research for an SOA newsletter.