Description: This paper is about a concept known as the 'rate of transmission of information' or, more simply, as the 'information rate.' The authors establish the equivalence of arbitrage-free economic systems and a generalized betting model in such a way that the interpretation of the information rate, as the maximum rate of increase of an investor's capital, is preserved. As a corollary to this result, they show that the difference in the information rate between models represents the achievable incremental return associated with the superior predictor model. From Actuarial Research Clearing House 1993, Vol. 3.

Description: This 1993 paper examined the premium rate changes that could have resulted from the passage of The Health Insurance Reform and Cost Control Act of 1991. From Actuarial Research Clearing House 1993, VOL. 3.

Description: On July 1 1997, a new privatized but compulsory retirement system came into effect in Mexico. The new system has a complex web of contributions by employers, employees and by the government. The retirement funds also have a complex web of charges applied to the funds. This paper carefully analyzes these complex cases to find out which funds perform the best. It shows through simulations that the optimal strategy for individual retirement account holder is not to stay with one fund throughout the working life. Instead, the best option is to switch at some point. The switching point depends on a number of factors: 1. the wage rate of the workers [and also on the growth rate of wages], 2. the real interest rate, and 3. the inflation rate. From Actuarial Research Clearing House 1999, Vol. 1.

Description: The projection methods used by the Social Security Administration's Office of the Chief Actuary are important. The resulting projections are cited regularly by policy-makers, academics and others interested in the long-term financial solvency of the OASDI system. However, a complete description of this projection methodology that is vital for serious policy discussions is not available to the general public. This summary was constructed in connection with the Social Security Advisory Board's 1999 Technical Panel on Methods and Assumptions. A goal of the Methods and Modeling working group of the Technical Panel was to 'work to ensure that the projection methods used by the Office of the Chief Actuary become more public.' From Actuarial Research Clearing House 2000, Vol. 1.

Description: The decline of importance of private defined benefit plans in relation to defined contribution plans in the United States is a major issue of interest to pension actuaries. This decline is undeniable, and has been attributed to numerous factors: costs of government regulation, societal and cultural changes, changed attitudes of employers, and employees' lack of understanding of defined benefit plans. It has also caused some to proclaim the end of a private defined benefit plan. This work analyzes possible macroeconomic factors contributing to the crisis of defined benefit plans, and proposes an alternative hypothesis for the cause of the crisis: the decline of relative attractiveness of defined benefit plans in relation to defined contribution plans due to the shift in the way relative returns to macroeconomic factors of production, i.e., capital and labor, are allocated in the national economy. Possibilities of improvement of the position of defined benefit plans are also discussed. From Actuarial Research Clearing House 1998 Vol. 2.

Description: Continuing change pervades the actuarial world. Actuarial tools and techniques are constantly evolving, new financial products and services appear regularly, legislation and regulation rarely remain unchanged for long, consumers are becoming better informed and more sophisticated, the financial environment is becoming increasingly global, distinctions between types of financial institution are becoming more blurred, and the areas in which actuaries find applications for their skills become more varied. In this context, the most important attribute for actuaries is the capacity to adapt. This paper considers some implications for university actuarial programs of the need to develop adaptive actuaries. It discusses the results of a survey of the preferred learning styles of Macquarie University actuarial students, examines the newly introduced Australian actuarial subject called 'The Actuarial Control Cycle,' and looks at the use of portfolios of student work. It concludes that in order to develop adaptive actuaries for the 21st century, actuarial programs must broaden the range and type of teaching/learning activities and assessment methods provided for students.

Description: The two basic considerations in a pension plan valuation are the choice of actuarial cost methods and actuarial assumptions. This paper deals with the assumptions. The concern in this regard is what actuaries are doing and why. There are explicit criteria why particular assumptions are chosen, and these have often been discussed in the pension literature. However, there also are implicit criteria, which, while seldom discussed in the literature, can dominate the valuation. The goal of this paper is to quantify some of these criteria, and thereby provide a basis for further discussion and research.

Description: This paper explores and develops some initial ideas of roll-forward reserve funding of Social Security. It reports on the work of actuarial students and teachers for an 8-week study period coordinated with the National Science Foundation program of Research Experience for Undergraduate grants. From Actuarial Research Clearing House 1994, VOL. 1.

Description: In practice, the actuary may be required to forgo independent mathematical judgment in order to follow regulations which prescribe specific exposure or enforce counts for full and partial credibility. In this paper the authors give specific examples of such regulation from various states, and discuss the positive and negative features of the regulatory approaches. From Actuarial Research Clearing House, 2003 Vol. 3.

Description: This paper provides provide mathematically-founded insights for how climate change and water access will impact Californian agriculture in the coming decades.