Investment of Social Security reserves in three countries.

The current buildup of the U.S. Social Security Trust Fund has caused speculation about both the potential consequences of the buildup under different policy objectives and the fund's management. As is often the case, the search for precedents under similar circumstances abroad has been quite extensive on the part of legislators and U.S. experts in the field of financial policy. This article summarizes the experiences of Canada, Japan, and Sweden--all of whom have accumulated large trust fund reserves--with a focus on their investment policies. Trust fund investments in the three countries are similar as to types of investments, but the pattern of distribution of these investments varies widely from one country to another.