Public Pension Fund Power

Abstract

The quotation is from Mr. Greenspan's testimony to Congress in 1999 on the Administration's proposal to invest a component of the Social Security Trust Fund in equities. As a response to that testimony, we were asked by a number of U.S. public sector pension funds to conduct a study into Mr. Greenspan's assertion. That study concludes that a sample of 34 U.S. public sector funds marginally outperformed a sample of 51 U.S. corporate funds on a cost- and risk adjusted basis over the 1994-1997 period (see Ambachtsheer, Hawn, and Scheibelhut [1999]).