nep-age New Economics Papers
on Economics of Ageing
Issue of 2012‒01‒25
eight papers chosen by
Claudia Villosio
LABORatorio R. Revelli

  1. Hours of Work and Retirement Behavior By Machado, C. Sofia; Portela, Miguel
  2. The impact of (early) retirement on the subsequent physical and mental health of the retired: a survey among general practitioners in Belgium. By Maes, Marjan; Stammen, Benjamin
  3. Social Protection of Older People By David E. Bloom; Emmanuel Jimenez; Larry Rosenberg
  4. Life expectancy, heavy work and return to education ; lessons for the social security reform By Gilles Le Garrec; Stéphane Lhuissier
  5. Pension funds in The Netherlands. By Kemna, A.G.Z.; Ponds, E.H.M.; Steenbeek, O.W.
  6. Estimating the Incidences of the Recent Pension Reform in China.Evidence from 100,000 Manufacturers By Zhigang Li; Minqin Wu
  7. Living Arrangements of the Elderly in China: Evidence from CHARLS By Lei, Xiaoyan; Strauss, John; Tian, Meng; Zhao, Yaohui
  8. Fiscal Consolidation: Part 3. Long-Run Projections and Fiscal Gap Calculations By Rossana Merola; Douglas Sutherland

  1. By: Machado, C. Sofia (Instituto Politécnico do Cávado e do Ave); Portela, Miguel (University of Minho)
    Abstract: Using a novel dataset from the 2006 Portuguese Labor Force Survey this paper examines the impact of a voluntary reduction in hours of work, before retirement, on the moment of exit from the labor force. If, as often suggested, flexibility in hours of work is a useful measure to postpone retirement, then a reduction in working hours should be associated with retirement at later ages. Results prove otherwise suggesting that reducing hours of work before retirement is associated with early exits from the labor force. A reduction in hours of work seems to signal the worker's wish to retire sooner rather than to announce the desire of remaining in the labor market. This result may enclose the need for some alternative policy strategies regarding working hours.
    Keywords: aging, retirement, working hours, older workers
    JEL: J14 J26 J22 J21
    Date: 2012–01
  2. By: Maes, Marjan (Hogeschool-Universiteit Brussel (HUB), Belgium); Stammen, Benjamin
    Abstract: Objectives: to investigate, on the basis of the perceptions of general practitioners (GPs) in Belgium, the impact of (early) retirement on subsequent physical and mental health. Method: A cross-sectional survey on the basis of a self-completed anonymous questionnaire sent at random to 120 GPs in Flanders (Belgium) to which 81 responded. Results: According to GPs, the mere fact of retiring early may be a (very) important cause of mental health problems, in particular depressions (due to the disappearance of social networks) and deterioration of cognitive capacities. GPs claim that most physical health problems that appear after retirement, like obesity and cardiovascular diseases, are due to insufficient adaptation (in terms of food consumption and physical activities) of the retired to a new lifestyle.Conclusion: GPs claim that health problems may frequently arise as a consequence of the retirement event. Since the factors causing these problems point to unhealthy behaviour, there is scope for health improvement: firstly, by stimulating older people to postpone retirement or to continue some professional activities during retirement and secondly, by making them aware of the role of social networks, physical activity and food consumption. At the same time, this would help to control increasing pension and health care expenditures.
    Keywords: cardiovascular disease; obesity; depression; retirement; Belgium; survey
    Date: 2011–03
  3. By: David E. Bloom (Harvard School of Public Health); Emmanuel Jimenez (World Economic Forum); Larry Rosenberg (Harvard School of Public Health)
    Abstract: Social protection is a major arena of government activity aimed at ensuring that vulnerable population groups receive appropriate and effective public support to ensure their financial security and to safeguard their health. However, despite the growth and extent of social protection programs in both developed and developing countries, most emerging economies have nascent systems and only a small portion of all such efforts address the specific vulnerabilities and needs of older people. This paper (a) discusses the vulnerabilities of older people and the benefits of crafting social programs to address them; (b) describes the nature of social protection and the forms it can take to address those vulnerabilities; (c) reports descriptive evidence on the availability and use of social protection programs; and (d) delineates steps that can be taken to remedy the shortfalls experienced by older people.
    Keywords: aging, social protection
    Date: 2011–11
  4. By: Gilles Le Garrec (Observatoire Français des Conjonctures Économiques); Stéphane Lhuissier (Banque de France)
    Abstract: In most industrial countries, while the calculation of pension bene?ts is progressive, public pension systems redistribute weakly from high to low- income earners. They are close to actuarial fairness. This statement results from the following speci?city: less paid jobs are also heavier and health- damaging jobs involving losses in life expectancy. As avoiding low earnings and hard-working conditions require acquisition of skills, we study conjointly in this article the impact of social security and the work-related life ex- pectancy loss on the schooling decision. We then study macroeconomic and distributional consequences of global gain in life expectancy associated with di¤erent social security reforms, focusing particularly on spillover e¤ects pos- sibly generated by education.
    Keywords: social security, human capital, inequality
    JEL: H55 J31 D63
    Date: 2011–10
  5. By: Kemna, A.G.Z.; Ponds, E.H.M. (Tilburg University); Steenbeek, O.W.
    Date: 2012
  6. By: Zhigang Li; Minqin Wu
    Abstract: An ongoing reform in China mandates employers to contribute significant amounts to employee pension funds. The current study estimates the impact of this reform on the wage, employment and performance of firms using data from over 140,000 medium and large manufacturers in China during 2004 and 2006. We find that the nominal wages of employees were rigid but their real wages may have declined due to the pension reform. In addition, we find an interesting dichotomy in the incidences of pension reform. In localities with high agglomeration levels, firms' profits declined because the pension burden could not be fully transferred to employees. In less agglomerated jurisdictions, firms responded positively to pension reform, possibly because local governments over-subsidized the pension costs as a way to attract investment.
    Keywords: Incidence, Pension, China
    JEL: H32 H55 J2
    Date: 2011–12
  7. By: Lei, Xiaoyan (Peking University); Strauss, John (University of Southern California); Tian, Meng (Peking University); Zhao, Yaohui (Peking University)
    Abstract: Recent increases in Chinese elderly living alone or only with a spouse has raised concerns about elderly support, especially when public support is inadequate. However, using rich information from the China Health and Retirement Longitudinal Study, we find that the increasing trend in living alone is accompanied with a rise in living close to each other. This type of living arrangement solves the conflicts between privacy/independence and family support. This is confirmed in further investigation: children living close by visit their parents more frequently. We also find that children who live far away provide a larger amount of net transfers to their parents, a result consistent with responsibility sharing among siblings. Having more children is associated with living with a child or having a child nearby, while investing more in a child's schooling is associated with greater net transfers to parents.
    Keywords: living arrangement, coresidence, proximity of children, CHARLS
    JEL: J12 J14
    Date: 2011–12
  8. By: Rossana Merola; Douglas Sutherland
    Abstract: During the economic and financial crisis, fiscal positions across the OECD countries deteriorated sharply. This raises the question of what level of primary deficit would ensure long-term sustainability and what degree of consolidation is needed. The purpose of this paper is to gauge the scale of fiscal consolidation that will be needed to ensure long-term sustainability. The analysis uses so-called fiscal gaps to provide a simple metric for how much consolidation is needed under a series of different assumptions and scenarios. The aim is to highlight the scale of the problems, how they differ across countries and the uncertainties surrounding the estimates. A first set of results suggest that lower debt targets provide greater room for manoeuvre to react to shocks in the future. A second set of results shows that growth-enhancing structural reforms | especially reforms of pension systems | can mitigate budget pressures resulting from ageing populations and hence contribute to fiscal consolidation. Furthermore, raising efficiency in the provision of health care and education can reduce budgetary pressures. Finally, achieving debt objectives under shocks to interest rates or to government spending would require additional tightening in most of the OECD countries.<P>Consolidation budgétaire : Partie 3. Projections à long terme et calcul des écarts budgétaires<BR>Durant la crise économique et financière, la position budgétaire des pays de l’OCDE s’est nettement dégradée. La question se pose dès lors de savoir quel niveau de déficit primaire assurerait la viabilité à long terme et quel degré d’assainissement est nécessaire. Ce document a pour objet d’évaluer l’ampleur de l’effort de consolidation budgétaire à consentir pour assurer la viabilité à long terme. L’analyse s’appuie sur les « écarts budgétaires », qui permettent de mesurer simplement l’ampleur de l’assainissement nécessaire suivant divers scénarios et hypothèses. L’objectif est de mettre en lumière l’échelle des problèmes, les différences qui existent d’un pays à l’autre et les incertitudes qui entourent les estimations. Une première série de résultats semble indiquer que des objectifs de dette plus bas offrent une plus grande marge de manoeuvre pour réagir aux chocs dans l’avenir. Une seconde série de résultats montre que des réformes structurelles propres à renforcer la croissance – en particulier les réformes des systèmes de retraite – peuvent atténuer les pressions budgétaires dues aux vieillissement des populations et, partant, contribuer à l’assainissement des finances publiques. Par ailleurs, rehausser l’efficience dans la prestation de services de santé et d’éducation peut atténuer les pressions budgétaires. Enfin, des chocs affectant les taux d’intérêt ou les dépenses publiques nécessiteraient un resserrement budgétaire plus sévère dans la plupart des pays de l’OCDE.
    Keywords: ageing populations, long-term projections, fiscal consolidation, long-term public finance sustainability, public social expenditure, vieillissement de la population, projections à long terme, consolidation budgétaire, viabilité des finances publiques à long terme, dépenses sociales publiques
    JEL: E62 H50 H68 J11
    Date: 2012–01–10

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