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on Economics of Ageing |
| By: | David Neumark |
| Abstract: | This paper reviews evidence on age discrimination in U.S. labor markets and on the effects of the Age Discrimination in Employment Act (ADEA) in combating this discrimination. It focuses on the challenge of population aging facing the U.S. economy in coming decades. Combating age discrimination is likely to help in meeting this challenge by encouraging employment of older individuals. But the paper also explores how rapid aging of the population protected by the ADEA might inhibit the ADEA's effectiveness, and raises questions about possible changes in age discrimination policies and enforcement that could enhance the ability of the ADEA to mitigate some of the adverse consequences of population aging. |
| JEL: | J14 J71 J78 |
| Date: | 2008–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14317&r=age |
| By: | Emma Aguila |
| Abstract: | Many countries are including personal retirement accounts (PRAs) as part of their social security systems. PRA systems boost private savings at the macro level by converting a government financial liability into private wealth. At the micro level, however, crowing-out effects on household savings could be offsetting some of this increase in private savings and may lead to inadequate preparedness for retirement. The author tests this hypothesis by using the Mexican social security reform of 1997 as a natural experiment, because only part of that system was changed from pay-as-you-go to PRAs. She finds that social security reform with PRAs does indeed crowd out household savings and recommends strengthening voluntary savings for retirement along with social security reform. |
| Keywords: | Social security reform, household saving, public policy evaluation |
| JEL: | D91 H55 J26 |
| Date: | 2008–07 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:600&r=age |
| By: | Yu-Fu Chen; Gylfi Zoega |
| Abstract: | We model a firm’s choice as to the age composition of dismissed workers for different assumptions about the level of firing costs. We find that when the cost of firing is independent of age, a higher level of firing costs will induce firms to fire their younger workers while lower costs induce them to fire the older ones. A corresponding effect is not found in the age dimension of the hiring decision. It follows that job protection favours more senior workers even when the cost of firing is independent of age and seniority. |
| Keywords: | Age-structure, tenure, firing decisions, real options |
| JEL: | E32 J23 J24 J54 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:dun:dpaper:206&r=age |
| By: | Jonathan D. Ketcham; Kosali Simon |
| Abstract: | We analyze Medicare Part D’s net effect on elderly out-of-pocket (OOP) costs and use of prescription drugs using a dataset containing 1.4 billion prescription records from Wolters Kluwer Health (WKH). These data span the period December 2004-December 2007 and include pharmacy customers whose age as of 2007 is greater than 57 years. The outcomes we examine are OOP cost per day’s supply of a medication, the days of medication supplied per capita, and the number of individuals filling prescriptions. We compare outcomes before vs. after January 2006, for those over age 66 years vs. for those age 58-64 years, adjusting for the under-reporting of certain cash-only transactions in the WKH data. Our results indicate that from 2005-2007, Part D reduced elderly OOP costs per day’s supply of medication by 21.7%, and increased elderly use of prescription drugs by 4.7%, implying a price elasticity of demand of -0.22. These effects occurred primarily during the first year of the program. An age- and time-standardized comparison of our quantity results with previous estimates from Walgreens data shows that our findings are 2.6 times as large. We conclude that Part D lowered elderly patients’ OOP costs substantially and increased utilization modestly, and note that in comparing results across studies on this topic, magnitudes may vary substantially due to differences in data and methods. |
| JEL: | H42 I11 I18 |
| Date: | 2008–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14326&r=age |
| By: | Pablo Antolin |
| Abstract: | This paper assesses how countries‘ pension arrangements and regulation shape the appropriate structure and flexibility of retirement payout options. The paper aims at providing a guide to policy makers on how to address the diverse questions posed when designing the payout phase or promoting DC pension arrangements, as well as encouraging a market for annuities. The paper addresses questions concerning the type of retirement payout options for accumulated assets in DC plans a country should allow, which entities should provide annuities, and the type of annuity products that could be allowed. The main recommendation is for policy makers to consider mandating deferred life annuities that start paying at very old ages (e.g. at age 85) and allow for the remaining assets accumulated in DC accounts to be allocated as programmed withdrawals (preferably with flexibility to face contingencies). <P>Options s’offrant aux pouvoirs publics pour la phase de versement des pensions <BR>Ce document examine comment les dispositions et réglementations prises par les pays en matière de pensions influent sur la structure et la flexibilité des options qui s‘offrent en phase de versement, une fois la retraite venue. Il vise à servir de guide pour les responsables publics en leur montrant comment aborder les diverses questions qui se posent au moment de fixer les modalités de la phase de versement, ou pour promouvoir des dispositifs de pension à cotisations définies, et aussi encourager un marché de rentes. Le document examine les options qui peuvent s‘envisager en phase de versement des avoirs accumulés sur les plans à cotisations définies, quelles entités devraient être habilitées à servir des rentes et le type de produits de rente qui peut être autorisé. La principale recommandation à l‘intention des responsables publics est d‘imposer des rentes viagères différées qui ne commenceront d‘être servies qu‘à un âge très avancé (par exemple à partir de 85 ans) et de prévoir que le solde des actifs accumulés sur les comptes à cotisations définies pourra être perçu sous la forme de retraits programmés (de préférence avec une marge de flexibilité pour faire face à des imprévus). |
| Keywords: | rente viagère, risque de longévité, Annuities, annuity markets, longevity risk, marches des rentes viagères, annuity providers, deferred life annuities, insurance companies, lump-sums, programmed withdrawal, retirement income, compagnie d’assurances, pourvoyeurs des rentes viagères, rentes viagères diffères, retrait programme, revenue des retraites, versement unique |
| JEL: | D11 D14 D91 E21 G11 G38 J14 J26 |
| Date: | 2008–09 |
| URL: | http://d.repec.org/n?u=RePEc:oec:dafaab:25-en&r=age |
| By: | Pablo Antolin; Colin Pugh; Fiona Stewart |
| Abstract: | This paper focuses on describing the international practice on the various forms of retirement benefit payment currently allowed in countries throughout the world and the regulatory environment surrounding these different forms of benefit payment. The analysis suggests considerable variance between countries. Some countries only allow one form of retirement payment, while others allow several forms or even a combination of them. Examining country practices as regard the providers of benefit payments, suggest that lump-sums and programmed withdrawals are generally provided by pension funds; while, as regard life annuities, providers varied from insurance companies, to pension funds, financial intermediaries and a centralised annuity fund. The paper ends by examining the role of taxation where a choice between different types of benefit payments is allowed. Tax provision plays a key direct or indirect role in influencing payout options. Cross country evidence is varied but suggests that there is often an unequal tax treatment of the various forms of retirement payout options. <P>Les différentes formes de prestations de retraite <BR>Pour l‘essentiel, ce document décrit les pratiques internationales en vigueur concernant les formes de prestations de retraite actuellement autorisées dans le monde, ainsi que les dispositifs réglementaires qui les régissent. Cette analyse fait ressortir de profondes disparités entre les pays. Certains n‘autorisent en effet qu‘un seul type de prestations, alors que dans d‘autres, plusieurs formules peuvent être envisagées, voir associées. S‘agissant des prestataires, l‘examen des pratiques nationales tend à montrer que les sorties en capital et les retraits programmés sont généralement proposés par des fonds de pension, alors que les rentes viagères sont servies par des compagnies d‘assurance, des fonds de pension, des intermédiaires financiers ou une caisse de retraite centralisée. Ce document s‘achève sur une analyse du rôle joué par la fiscalité lorsque plusieurs types de prestations sont possibles. Les dispositions fiscales exercent alors directement ou indirectement une influence décisive sur le choix des modes de sortie. Les données comparatives concernant les différents pays sont hétérogènes, mais laissent supposer que les divers modes de sortie sont rarement soumis au même régime fiscal. |
| Keywords: | taxation, fiscalité, pension fund, fond de pension, rente viagère, benefit payments at retirement, centralized annuity fund, financial intermediaries, insurance companies, life annuities, lump-sums, programmed withdrawal, regulatory environment, caisse de retraite centralisée, compagnie d’assurances, dispositif réglementaire, intermédiaires financiers, prestations de retraite, retrait programme, sorties en capital |
| JEL: | D14 D91 E21 G11 G38 J14 J26 |
| Date: | 2008–09 |
| URL: | http://d.repec.org/n?u=RePEc:oec:dafaab:26-en&r=age |
| By: | Liliana E. Pezzin; Robert A. Pollak; Barbara S. Schone |
| Abstract: | Do adult children affect the care elderly parents provide each other? We develop two models in which the anticipated behavior of adult children provides incentives for elderly parents to increase care for their disabled spouses. The "demonstration effect" postulates that adult children learn from a parent's example that family caregiving is appropriate behavior. The "punishment effect" postulates that adult children may punish parents who fail to provide spousal care by not providing future care for the nondisabled spouse when necessary. Thus, joint children act as a commitment mechanism, increasing the probability that elderly spouses will provide care for each other; stepchildren with weak attachments to their parents provide weaker incentives for spousal care than joint children. Using data from the HRS, we find evidence that spouses provide more care when they have children with strong parental attachment. |
| JEL: | D1 J1 J2 |
| Date: | 2008–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14328&r=age |