Are State Public Pensions Sustainable? Why the Federal Government Should Worry About State Pension Liabilities

Paper: SSRN 1596679

Abstract

This paper analyzes the flow of state pension benefit payments relative to asset levels and contributions. Assuming future state contributions fund the full pre

Complexity vs Empirical Score

• Math Complexity: 3.0/10
• Empirical Rigor: 7.0/10
• Quadrant: Street Traders — practical and empirical, lighter on theory

Why this score: The paper uses straightforward present value calculations and scenario analysis based on state-reported data rather than advanced mathematical derivations, but it is heavily data-driven, relying on extensive actuarial and financial data from state pension reports to produce specific numerical forecasts and state-by-state outcomes.

Research Flowchart

  flowchart TD
  A["Research Goal: Assess State Pension Sustainability<br> & Asset Liability Management"] --> B["Data Inputs: State Pension Fund<br>Benefit Payments, Asset Levels, Contributions"]
  B --> C["Computational Process:<br>Stochastic Modeling of Asset Liability Mismatch"]
  C --> D["Key Finding: Insufficient Contributions<br>to Fund Full Future Benefits"]
  D --> E["Outcome: Solvency Risk Identified<br>Requiring Federal Policy Attention"]