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Not so modest: Pension benefits for full-career state government employees

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  • Andrew G. Biggs

    (American Enterprise Institute)

Abstract

City and state governments around the country are pursuing reforms to address the rising costs of public employee pension plans. In response, public employee unions and pension plans themselves often portray these benefits as "modest." In reality, public pension plans offer long-term government workers benefits that make them among the best-off retirees in the country. Indeed, the average full-career government worker in eight states retires as a "pension millionaire," with 23 states paying $750,000 or more in lifetime retirement benefits. Drastic benefit reductions for current retirees would be unfair, but reforms that make public- and private-sector pensions more comparable should be on the table.

Suggested Citation

  • Andrew G. Biggs, 2014. "Not so modest: Pension benefits for full-career state government employees," AEI Economic Perspectives, American Enterprise Institute, March.
    • Handle: RePEc:aei:journl:y:2014:id:416777
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    References listed on IDEAS

    as
    1. Glaeser, Edward L. & Ponzetto, Giacomo A.M., 2014. "Shrouded costs of government: The political economy of state and local public pensions," Journal of Public Economics, Elsevier, vol. 116(C), pages 89-105.
    2. Robert M. Costrell & Michael Podgursky, 2009. "Peaks, Cliffs, and Valleys: The Peculiar Incentives in Teacher Retirement Systems and Their Consequences for School Staffing," Education Finance and Policy, MIT Press, vol. 4(2), pages 175-211, April.
    3. repec:aei:rpaper:30975 is not listed on IDEAS
    4. Robert M. Costrell & Josh B. McGee, 2010. "Teacher Pension Incentives, Retirement Behavior, and Potential for Reform in Arkansas," Education Finance and Policy, MIT Press, vol. 5(4), pages 492-518, October.
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    Cited by:

    1. Touria Jaaidane & Robert J. Gary-Bobo, 2018. "The Evaluation of Pension Reforms in the Public Sector: A Case Study of the Paris Subway Drivers," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 174(2), pages 245-277, June.
    2. Jeffrey R. Brown & Richard F. Dye, 2015. "Illinois Pensions in a Fiscal Context: A (Basket) Case Study," NBER Working Papers 21293, National Bureau of Economic Research, Inc.

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