Price efficiency in the Dutch Annuity Market

Research output: Contribution to journalArticle (Academic Journal)peer-review

8 Citations (Scopus)


We provide the first analysis of annuity rates in the Netherlands for the period 2001–2012. During this period, the number of annuity providers was high and stable, and we find that falls in annuity rates can be explained entirely by changes in yields and life expectancy. We show that annuitants could have increased their annuity income by about 5%, by shopping around and purchasing their annuities from alternative providers. Money's worth calculations show that the market is efficient by international standards, with a money's worth above 0.9 for the whole period and close to unity by the end of the period. We present conflicting evidence on the existence of adverse selection because although we find money's worths are inversely related to age of purchase, we find that they are positively related to size of purchase.
Original languageEnglish
Pages (from-to)1-18
Number of pages18
JournalJournal of Pension Economics and Finance
Issue number1
Early online date9 Sept 2013
Publication statusPublished - 1 Jan 2015

Structured keywords

  • AF Financial Markets


  • annuities
  • pension freedoms
  • drawdown


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