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on Economics of Ageing |
| By: | Sahlgren, Gabriel H. (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Declining fertility rates and increasing life expectancy necessitate a higher labor participation rate among older people in order to sustain pension systems and boost economic growth. At the same time, researchers have only recently begun to pay attention to the health effects of a longer working life, with rather mixed results thus far. Utilizing panel data from eleven European countries, and two distinct identification strategies to deal with endogeneity, we provide new evidence of the health effects of retirement.In contrast to prior research, we analyze both the impact of being retired and the effect of spending longer time in retirement. Using spouses’ characteristics as instruments, while taking precautions to ensure validity, we find a robust, negative impact of being retired and spending longer time in retirement on selfassessed, general, mental and physical health.In addition, we show that the impact on selfassessed health remains similar in models using instruments from previous research while also including individual- and time-fixed effects to remove time-invariant unobserved heterogeneity between individuals as well as common health shocks.Overall, the results suggest that this innovation and the fact that we take lagged effects into account explain the differences in comparison to prior multi-country research using these instruments. While the short-term health impact of retirement in Europe remains uncertain, the medium- to long-term effects appear to be negative and economically large. |
| Keywords: | Health; Retirement; SHARE; SHARELIFE |
| JEL: | I10 J14 J26 |
| Date: | 2012–09–27 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0928&r=age |
| By: | Alicia Munnell; Jean-Pierre Aubry; Joshua Hurwitz; Laura Quinby |
| Abstract: | Public sector defined benefit pension plans are based on final earnings. As such, these plans are back-loaded; those with long careers receive substantial benefits and those who leave early receive little. The analysis consists of three parts. The first section discusses the design of state and local defined benefit plans, documents the extent to which traditional public sector final earnings plans are back-loaded, and explores the extent to which the incentives may reflect the preferences of employers. The second section shows how participation in final earnings plans affects the lifetime resources of state and local workers of various tenures compared to private sector workers. The third section presents plan-level data on the flows of participants out of the plan by age and tenure and explores the extent to which plan design – specifically, vesting periods, mandatory participation in a defined contribution plan, and Social Security coverage – affects the probability of vesting and the probability of remaining to the earliest full retirement age once vested. The findings suggest that complete reliance on delayed vesting and final earnings plans results in minimal benefits for most short-service public employees. Hence, the recent trend towards hybrid arrangements is a positive development not only for risk sharing between taxpayers and participants but also for a more equitable distribution of benefits between short-term and career employees. |
| JEL: | H75 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18448&r=age |
| By: | Marie-Pier Bergeron Boucher |
| Abstract: | With a lower and lower mortality at younger ages, gains in life expectancy are heavily dependent on improvements in old age survival. However, over the last three decades, life expectancies at ages 65 and 85 did not show a constant rate of progress. Changes in life expectancy come from variations in the prevalence of specific causes of death trends and their interactions. The present thesis looks at the contribution of some causes of death on the changes observed in life expectancies and also at the trends in cause-specific death rates for Canada between 1979 and 2007. Results show that progresses in life expectancy at ages 65 and 85 are still mainly due to decreasing mortality from cardiovascular diseases. However, cardiovascular diseases are not the only causes of death to contribute to the gains in life expectancy. Death rates from the ten leading causes of death in Canada have all declined since the turn of the Century, but with different pathways from 1979 on. |
| Keywords: | Causes of death, life expectancy, mortality, elderly, Canada |
| JEL: | I10 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:mcm:sedapp:299&r=age |
| By: | Scherger, Simone; Hagemann, Steffen; Hokema, Anna; Lux, Thomas |
| Abstract: | The paper investigates paid work beyond retirement age in Germany and the UK. This comprises a combination of work, payments from a pension (or several pensions) and old age which is counter to the assumed finality of retirement and the corresponding standardised passage from end of work into retirement and receipt of a pension. Paid work beyond retirement has not only become more frequent in the last decade, but is also part of heated policy debates on pension reform. The paper first gives a comprehensive literature review, presenting empirical results, conceptual differentiations and theoretical approaches to post-retirement work from previous studies. A heuristic model summarises the most important individual and structural influences on post-retirement work. Thereafter, the most important features of the pension systems and labour markets in Germany and in the UK are outlined. In terms of institutional settings, the countries represent opposing cases whose comparison helps to better understand the institutional factors shaping employment beyond retirement age. In the second half of the paper, data from the German Ageing Survey (DEAS) and the English Longitudinal Study of Ageing (ELSA) serve to empirically describe paid work beyond retirement age. In addition to the demographic and regional distribution of postretirement work, particular attention is paid to the socio-economic status of people working past retirement, in comparison to those who do not work. Other important areas studied are non-paid activities of post-retirement workers, their health and living arrangements as well as their life satisfaction and subjective reasons for employment. On the one hand, the results of the empirical description confirm the privileged situation of many post-retirement workers who, for example, tend to be more highly educated and have better health than their non-working counterparts. On the other hand, some post-retirement workers work for financial reasons and in the low-paid service sector. There are some indications that the latter group, who experience post-retirement work more often as a burden, or at least in a more ambivalent way, is larger in the UK than in Germany, mainly for institutional and structural reasons. -- Dieses Arbeitspapier beschäftigt sich mit Erwerbsarbeit jenseits der Rentengrenze in Deutschland und Großbritannien. Mit Erwerbsarbeit jenseits der Rentengrenze ist eine Kombination von bezahlter Arbeit, Rentenzahlungen und Alter gemeint, die im Kontrast steht zur Endgültigkeit des Ruhestands und dem entsprechenden standardisierten Übergang aus der Erwerbsarbeit in den Ruhestand und zum Empfang von Rentenzahlungen. Erwerbsarbeit jenseits der Rentengrenze ist in den letzten zehn Jahren nicht nur häufiger geworden; sie wird auch intensiv debattiert, etwa im Rahmen von Diskussionen zu Rentenreformen. Das Arbeitspapier gibt zunächst einen umfassenden Literaturüberblick, der bisherige empirische Ergebnisse, konzeptuelle Differenzierungen und theoretische Annäherungen an Erwerbsarbeit jenseits der Rentengrenze einschließt. Ein heuristisches Modell fasst die wichtigsten individuellen und strukturellen Einflüsse auf Arbeit jenseits der Rentengrenze zusammen. Anschließend werden sowohl die Rentensysteme als auch die Arbeitsmarktstrukturen Deutschlands und Großbritanniens in groben Zügen beschrieben. Was den institutionellen Rahmen angeht, repräsentieren die beiden Länder zwei gegensätzliche Fälle, deren Vergleich dazu beiträgt, die institutionellen Faktoren zu verstehen, welche Erwerbsarbeit jenseits der Rentengrenze prägen. In der zweiten Hälfte des Arbeitspapiers werden Daten des Deutschen Alters-Surveys (DEAS) und der English Longitudinal Study of Ageing dazu genutzt, Erwerbsarbeit jenseits der Rentengrenze empirisch zu beschreiben. Über die soziodemographischen Charakteristika von erwerbstätigen Rentnern und die regionale Verteilung dieser Form von Arbeit hinaus wird dem sozio-ökonomischem Status erwerbstätiger Rentner im Vergleich zu anderen Rentnern besondere Aufmerksamkeit gewidmet. Außerdem werden unbezahlte Aktivitäten erwerbstätiger Rentner, ihre Gesundheit und Lebensformen sowie ihre Lebenszufriedenheit und die subjektiven Gründe für ihre Arbeit beschrieben. Einerseits bestätigen die Ergebnisse der Beschreibung die eher privilegierte Situation erwerbstätiger Rentner, die beispielsweise eine bessere Bildung aufweisen und gesünder sind als nicht-erwerbstätige Rentner. Andererseits gibt es erwerbstätige Rentner, die aus finanziellen Gründen und im schlechtbezahlten Dienstleistungssektor arbeiten. Einiges deutet darauf hin, dass die letztgenannte Gruppe, die ihre Arbeit häufiger als eine Bürde oder zumindest ambivalent erlebt, in Großbritannien größer ist als in Deutschland, und zwar vor allem aus institutionellen und strukturellen Gründen. |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zeswps:042012&r=age |
| By: | Barry Bosworth |
| Abstract: | The paper uses micro-survey data from successive waves of the Panel Study on Income Dynamics to investigate the distribution of wealth and job losses during the 2007-09 recession for difference segments of the population and the effect of the recession on the retirement decisions of older workers. Estimates of wealth losses are constructed for major socioeconomic group and compared with those of the Survey of Consumer Finances. The panel dimension of the data is used to measure change in the labor force status of workers and to estimate the determinants of the decision to transition from participation in the labor force to retirement. the study concludes that retirement decisions are influenced both by variations in labor market conditions and by the value of household wealth but that labor market exerts a larger impact. |
| Date: | 2012–02 |
| URL: | http://d.repec.org/n?u=RePEc:crr:crrwps:wp2012-4&r=age |
| By: | Montizaan Raymond; Vendrik Maarten (ROA rm) |
| Abstract: | This study investigates the effects of social comparisons accompanying a substantialreform of the Dutch pension system on the job satisfaction of workers who are close toretirement. The reform implies that public sector workers born on January 1, 1950, orlater face a substantial reduction in their pension rights, while workers born before thisthreshold date can still retire under the old, more generous rules. Using unique matchedsurvey and administrative panel data on male public sector workers born in 1949 and1950, we find strong and persistent effects on job satisfaction that are sizable comparedto income effects on well-being. The drop in satisfaction is strongly affected by socialcomparisons with colleagues. Treated workers are less affected by the reform when thetreatment group is larger in the organization where they are employed. Moreover, thesocial comparison effect is especially prevalent in organizations that stimulate theiremployees to work in teams. We also find evidence that workers compare their ownreplacement rate with the average replacement of comparable individuals in theirorganization, but the major part of the social comparison effect is non-monetary. |
| Keywords: | education, training and the labour market; |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umaror:2012013&r=age |
| By: | Yitaek Park (Department of Economics, Korea University, Seoul, Republic of Korea); Junghun Seung (Department of Economics, Korea University, Seoul, Republic of Korea); Kyeongrok Lee (Department of Economics, Korea University, Seoul, Republic of Korea) |
| Abstract: | This paper studies causal relation between the old-age dependency ratio and population change factors (fertility, mortality and migration), using the data of the administrative districtions of South Korea between 2005 to 2011. The main results show there is not panel Granger causality between the old-age dependency ratio and fertility but between the old-age dependency ratio and mortality/migration. |
| Keywords: | Old-age dependency ratio, convergence and divergence, Panel Granger causality test |
| JEL: | C14 J11 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:iek:wpaper:1210&r=age |
| By: | Cappelen, Alexander W. (Dept. of Economics, Norwegian School of Economics and Business Administration); Urheim, Runa (Dept. of Economics, Norwegian School of Economics and Business Administration) |
| Abstract: | Pension funds and sovereign-wealth funds own a large and increasing fraction of the shares in publicly traded companies in the OECD area. These funds typically have a very long time horizon on their investments, as well as highly diversified portfolios. These features imply that the interests of these funds on important issues are aligned with the interest of future generations because the longterm return on a highly diversified portfolio will depend on the degree to which the development of the world economy is sustainable. It is, therefore, in the enlightened self-interest of these investors to use their shareholder rights so as to protect the interest of future generations. The paper explores the arguments for a more active corporate governance policy among pension funds and sovereign-wealth funds and discusses the obstacles to such policies. |
| Keywords: | Pension funds; sovereign funds; future generations; corporate governance; shareholder. democracy. |
| JEL: | G20 G34 |
| Date: | 2012–09–27 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhheco:2012_019&r=age |
| By: | Felix Hüfner; Caroline Klein |
| Abstract: | The strength of the German labour market response to the financial crisis of 2008-09 demonstrated the benefits of past labour market reforms, which raised work incentives, improved job matching and increased working hour flexibility. Going forward, the government should build on this success and address the remaining challenges which include raising the labour participation of females and older workers (which among other things will necessitate adjustments to the tax and education system) and fostering migration, notably of skilled workers. The significant ageing-related decline in the labour force exemplifies the urgency of further structural reforms in this area. This Working Paper relates to the 2012 Economic Survey of Germany, www.oecd.org/eco/surveys/germany.<P>Le marché du travail en Allemagne : préparer l´avenir<BR>La résilience dont a fait preuve le marché du travail allemand face à la crise financière de 2008-09 témoigne du bien-fondé des réformes passées, qui ont permis d’améliorer les incitations au travail, de garantir une meilleure adéquation entre offres et demandes d’emploi et de renforcer la flexibilité du temps de travail. Les pouvoirs publics allemands doivent s’appuyer sur ce succès pour relever les défis qui subsistent, à savoir augmenter le taux d’activité des femmes et des seniors (ce qui impliquera notamment des ajustements sur le plan de la fiscalité et du système éducatif) et encourager l’immigration, surtout des travailleurs qualifiés. La contraction importante de la main-d’oeuvre sous l’effet du vieillissement de la population témoigne de l’urgence de nouvelles réformes structurelles dans ce domaine. Ce document de travail se rapporte à l’Étude économique de l’OCDE sur l’Allemagne 2012, www.oecd.org/eco/etudes/allemagne. |
| Keywords: | unemployment, migration, Germany, labour force participation rates, female employment, labour shortages, older workers, chômage, Allemagne, travailleurs âgés, emploi des femmes, migration, taux d’activité, besoins de main d’oeuvre |
| JEL: | J11 J21 J22 J24 J26 J61 J63 |
| Date: | 2012–09–13 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:983-en&r=age |
| By: | Wilson, E. J. (Asian Development Bank Institute); Jayanthakumaran, K. (Asian Development Bank Institute); Verma, R. (Asian Development Bank Institute) |
| Abstract: | This paper considers two major issues that need to be treated as matters of urgency. First, internal (within country) migrations in the Asian (ACI) region are mostly undocumented and large. Second, the emerging demographic imbalances in the form of aging, which will give dependency ratios that have never been experienced in all of recorded human existence. Whilst it is possible to share the burdens of ageing and dependency through migration, this will not happen under present arrangements. Increasing the mobility of humans is the best way to not only promote economic efficiency, but to provide freedom and significant improvements in their wellbeing and quality of life. |
| Keywords: | demographics; labor mobility; migration; asia; demographic imbalances; aging; productivity |
| JEL: | F22 J31 J61 O15 |
| Date: | 2012–10–12 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbiwp:0387&r=age |
| By: | Hyoungjong Kim (Department of Economics, Korea University, Seoul, Republic of Korea); Yitaek Park (Department of Economics, Korea University, Seoul, Republic of Korea); Hunchang Lee (Department of Economics, Korea University, Seoul, Republic of Korea) |
| Abstract: | This paper deals with the changes of aged dependency and aged-child ratios across the administrative districts of South Korea between 1992 and 2010. South Korea faces the most rapidly aging population at present. However, the generational imbalance is highly different between the districts. The main results show the dynamics of distribution and the trends of inequality indices for aged dependency and aged-child ratios in South Korea. |
| Keywords: | Aging, Distribution dynamics, Nonparametric estimation, Shift-share analysis |
| JEL: | C14 J11 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:iek:wpaper:1209&r=age |
| By: | Haizhen Lin (Department of Business Economics and Public Policy, Indiana University Kelley School of Business); Jeffrey T. Prince (Department of Business Economics and Public Policy, Indiana University Kelley School of Business) |
| Abstract: | We examine the impact of U.S. states’ adoption of the partnership long-term care (LTC) insurance program on households’ purchases of private coverage. This program increases benefits of privately insuring via a higher asset threshold for Medicaid eligibility for LTC coverage, and targets middle-class households. We find the program generates few new purchases of LTC insurance, and those it generates are almost entirely by wealthy individuals, as predicted by Medicaid crowd-out. Further analysis suggests that awareness levels of the program, along with bequest intentions, also effectively predict response rates, but Medicaid crowd-out persists. We provide an estimate of expected Medicaid savings/costs. |
| JEL: | I1 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:iuk:wpaper:2012-01&r=age |