TIAA-CREF has awarded its fourth annual Paul A. Samuelson Award to John Geanakoplos, the James Tobin Professor of Economics and director of the Cowles Foundation, for a work he coauthored, titled "Social Security Money's Worth."

In the study, Geanakoplos and his coauthors, Olivia S. Mitchell of The Wharton School and Stephen P. Zeldes of Columbia University, critique several measures frequently used to compare Social Security outcomes under different reform scenarios. They argue that the costs and risks of reforming Social Security are obscured or understated in proposals from virtually all points on the political and economic spectrum. Specifically, they say:

* Any reform of Social Security must deal with accrued benefits promised to individuals for past contributions, and estimates of these benefits can differ by as much as $800 billion.

* While privatizing Social Security may have some benefits, current proposals do not properly account for the immense cost of transition, the impact of transaction costs and the risks involved.

* The benefits of investing in the stock market have been exaggerated. Contrary to an earlier official study, the present-value gain of investing a dollar of Social Security funds in equities instead of bonds would be 59 cents, not $2.85, when properly adjusted for risk factors.

The study first appeared in "Prospects for Social Security Reform," published by the University of Pennsylvania Press in 1999.

Geanakoplos and his coauthors received the TIAA-CREF award in January at the annual meeting of the Allied Social Science Association in Boston. The prize, which is named after Nobel Prize-winning economist Paul Samuelson, carries a $20,000 cash award.

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