The impact of surplus sharing on the portfolio mix of public sector defined benefit pension plans: a public choice approach

The riskiness of state employee pension plan portfolios varies across states. We investigate whether this variation is related to how public employees and taxpayers share actuarial surpluses of pension accounts. We focus on two determinants of a plan’s asset mix: the relative influence of public employees to taxpayers; and whether a surplus-sharing contract is specified. Our theoretical model demonstrates that the effect of public employee influence on the asset mix is ambiguous. Our empirical results corroborate this complex theoretical result. In our theoretical and empirical analyses, if a surplus sharing rule is specified, plans adopt a more aggressive investment allocation.     

First Priorities in Military Professionalism

This article contends that it is time for the armed forces to revisit their schools, day rooms, wardrooms, squadron meeting places, headquarters, bases and posts to increase the level of awareness and the teaching of professional norms.     

Searching for the best structure for American local government

Citizens, practitioners and academicians involved in local government have for decades debated the best structure for local public organizations; at the polar ends of this debate are those advocating rational administration and those advocating political responsiveness. The conventional wisdom equates rational administration with reformed structures like the council-manager plan and political responsiveness with structures which have an elected chief executive officer. The debate is unresolvable within this value-driven framework, and these ideological positions do not seem to be helping in the design of governmental structures which “work” in a practical and meaningful way. The paper argues for a “functional” model of local government structure based on how much citizens and administrators can know and oversee with competence. The analysis leads to a significant rethinking of the role of governing bodies, administrators, and the general management position in American local government.