Constructing pension wealth in Norway
The concept of pension wealth has been extensively used by economists in theoretical and applied research since Feldstein's seminal paper (1974), but in recent decades, due to population ageing, it has attracted the attention from a wider scientific community and from policy makers. Pension wealth constitutes a significant proportion of total household wealth, but few countries have a comprehensive measure of pension wealth at the individual level. This report presents new and unique individual pension wealth data calculated using a sophisticated microsimulation model, the Norwegian micro-simulation model MOSART. With this model the present value of accrued-to-date pension wealth in defined benefit plans can be calculated under realistic and detailed assumptions about retirement age and individual expected longevity (based on socio-demographic characteristics). In this report we describe details of the underlying pension system and discuss assumptions made in the calculation of pension wealth. Finally, we present the distribution of individual pension wealth data, and how results may be affected by alternative choices in present value calculations.