Risk aspects of investment-based social security reform

The United States' current social security system operates on a pay-as-you-go basis; benefits are paid almost entirely out of current revenues.

As the ratio of retirees to taxpayers increases, concern about the high costs of providing benefits in a pay-as-you-go system has led economists to explore other options.

One involves 'prefunding', in which a person's withholdings are invested in financial instruments, such as stocks and bonds, the eventual returns from which would fund his or her retirement.

The risks such a system would introduce - such as the volatility in the market prices of investment assets - are the focus of this book.