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on Economics of Ageing |
| By: | de Grip, Andries (ROA, Maastricht University); Fouarge, Didier (ROA, Maastricht University); Montizaan, Raymond (ROA, Maastricht University) |
| Abstract: | This paper investigates the causal effects of the announcement of an increase in the statutory pension age on employee retirement expectations. In June 2010, the Dutch government signed a new pension agreement with the employer and employee organizations that entailed an increase in the statutory pension age from 65 currently to 66 in 2020 for all inhabitants born after 1954. Given the expected increase in average life expectancy, it was also decided that in 2025 the pension age would be further increased to 67 for those born after 1959. This new pension agreement received huge media coverage. Using representative matched administrative and survey data of public sector employees, we find that the proposed policy reform increased the expected retirement age by 3.6 months for employees born between 1954 and 1959 and by 10.8 months for those born after 1959. This increase is reflected in a clear shift in the retirement peak from age 65 to ages 66 and 67 for the respective treated cohorts. Men respond less strongly to the policy reform than women, but within couples we find no evidence that the retirement expectations of one spouse are affected by an increase in the statutory pension age of the other. Furthermore, we show that treatment effects are largely driven by highly educated individuals but are lower for employees whose job involves physically demanding tasks or managerial and supervisory tasks. |
| Keywords: | retirement, labor supply, pension system reform, cross-spouse effects |
| JEL: | J14 J26 |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7269&r=age |
| By: | Alicia H. Munnell; Jean-Pierre Aubry; Anek Belbase; Joshua Hurwitz |
| Abstract: | States have begun to respond to their pension challenge by enacting a mix of revenue increases and benefit cuts. These changes will, over time, improve the financial outlook for plans and help ease their impact on other budget priorities. But, to date, the specific nature and magnitude of these effects on plan finances and overall state budgets has received little attention. This brief reports on a study designed to fill the void with an analysis of pension costs before the financial crisis, after the financial crisis, and after reforms for a sample of 32 plans in 15 states. The study also introduces a companion series of fact sheets on each of the sample plans and states. |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:crr:issbrf:ibslp30&r=age |
| By: | Swenson, David A. |
| Abstract: | Iowa endured high outmigration rates among young adults during the 2000 to 2010 period. In light of accelerating exits from the labor force as the "baby boom" generation reaches retirement age and Iowa's somewhat smaller labor force ages 25 through 44 than the national average, the state's labor force is projected to contract.This report uses age and sex specific mortality and migration rates from the 2000 to 2010 period to project Iowa's working age population by 2020. Overall, the projections indicate an expected contraction in the Iowa population ages 16 to 64 of 74,142 persons. If that is the case, Iowa's economy may have trouble expanding. |
| Keywords: | labor force; migration; population projection; survival rates; economic growth |
| Date: | 2013–03–13 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genres:36040&r=age |
| By: | Marie-Agnès Barrère-Maurisson (Centre d'Economie de la Sorbonne) |
| Abstract: | The employment of the seniors is one of the stakes of the next years in our developed companies. Indeed those will be more numerous, at the same time for demographic reasons and because of the retreat of the retirement age (in particular for the women). Thus, the companies will be more often confronted with the question of the conditions of employment of the seniors who must assume the load, partial or more important, of their own old parents. This family load will be added in many cases to that which they already assume near their grandchildren. The active people of more than 55 years thus have an important load of domestic work completed for others, in particular for the widened family, while at the same time their own health starts to degrade itself. One proposes here to analyze the incidences as of these phenomena on the conditions of employment of the active seniors, and this in two directions. First of all impact on the practices of the companies in terms of management and adjustment of times. Then, as regards employee, as regards practices of management of personal times: working time, domestic time, "large-parental time" and "time of intergenerational solidarity". |
| Keywords: | Work/family, seniors, working time, domestic time, parental time. |
| JEL: | J12 J14 J16 J21 J22 J26 |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:mse:cesdoc:13022&r=age |
| By: | Jean Burson; John Carlson; O. Emre Ergungor; Patricia Waiwood |
| Abstract: | States’ unfunded pension obligations to their current and retired employees have exploded in recent years to levels that are estimated to be between $750 billion and $4.4 trillion. In theory, this massive debt should have implications for states’ ability to meet their financial obligations and a measurable impact on funding costs. Yet, we find no evidence that municipal bond markets are pricing the risks to states’ fiscal health arising from these large obligations. |
| Keywords: | Pensions ; Local finance |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedcwp:1301&r=age |
| By: | Bosch, Nicole (CPB Netherlands Bureau for Economic Policy Analysis); ter Weel, Bas (CPB Netherlands Bureau for Economic Policy Analysis) |
| Abstract: | This paper analyses changes in job opportunities of older workers in the Netherlands in the period 1996-2010. The standard human capital model predicts that, as a result of human capital obsolescence, mobility becomes more costly when workers become older. We measure and interpret how changing job opportunities across 96 occupations affect different age and skill groups. Older workers end up in shrinking occupations, in occupations with a lower share of high-skilled workers, in occupations facing a higher threat of offshoring tasks abroad, more focus on routine-intensive tasks and less rewarding job content. This process is not only observed for the oldest group of workers, but for workers aged 40 and above. Observing older workers in declining occupations is to a large extent a market outcome, but declining job opportunities in terms of less satisfying working conditions and job tasks and content could potentially raise incentives to retire early. |
| Keywords: | occupational mobility, employment, older workers |
| JEL: | J24 J60 |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7252&r=age |
| By: | Edwin J. Elton; Martin J. Gruber; Christopher R. Blake |
| Abstract: | Defined contribution plans, predominantly 401(k)s, are the primary source of personal retirement savings for American workers, making the investment decisions within these accounts a salient policy concern. These decisions are a result of two separate actions: the mutual fund options selected by the employer’s plan administrator and the specific funds chosen by the participant. While considerable research has examined 401(k) participant decisions in isolation, surprisingly little attention has been focused on the choices made by plan administrators. The administrator’s role is clearly influential, particularly if, as indicated by prior research, 401(k) participants themselves do not make good choices. This brief, based on a prior study, addresses this research gap by focusing on the fund choices of 401(k) plan administrators and participants’ reactions to these choices. |
| Date: | 2013–01 |
| URL: | http://d.repec.org/n?u=RePEc:crr:issbrf:ib2013-1&r=age |
| By: | Matthew S. Rutledge; Natalia Orlova; Anthony Webb |
| Abstract: | In economic downturns prior to the Great Recession, workers over age 50 had escaped relatively unscathed. But the unemployment rate for older workers soared to record highs during the Great Recession. This paper projects how older workers will fare across a broad set of financial outcomes over the remainder of this decade. The model estimates how these outcomes differ between individuals who remained employed and those who were displaced during the recession, controlling for their demographic characteristics. We also seek to determine whether there is any variation in their financial outcomes based on the nature of their layoffs – mass versus individual layoffs – and whether labor market conditions played a role in these outcomes. First, the results show that displaced workers are projected to be significantly worse off: their earnings are 14-19 percent lower over the remainder of this decade, financial assets are 22-30 percent lower, and they are up to 8 percent more likely to experience another layoff. Projections also indicate that older Americans will continue to feel the effects of the Great Recession and that labor force participation, earnings and financial assets all will be lower than they would have been after a milder recession like the one in 2001-2003. Second, although the model allows for differences in the nature of layoffs and in local labor market conditions, there is neither evidence that workers subject to mass layoffs are of higher average quality nor evidence that outcomes are worse in locations hit by more severe recessions. |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:crr:crrwps:wp2013-9&r=age |
| By: | Masashi Ieda; Takashi Yamashita; Yumiharu Nakano |
| Abstract: | We propose a long term portfolio management method which takes into account a liability. Our approach is based on the LQG (Linear, Quadratic cost, Gaussian) control problem framework and then the optimal portfolio strategy hedges the liability by directly tracking a benchmark process which represents the liability. Two numerical results using empirical data published by Japanese organizations are served: simulations tracking an artificial liability and an estimated liability of Japanese organization. The latter one demonstrates that our optimal portfolio strategy can hedge his or her liability. |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1303.3956&r=age |
| By: | Wei Sun; Anthony Webb |
| Abstract: | Although long-term care is a substantial financial risk for retired households, only about 10 percent purchase insurance, with many of the remainder relying on Medicaid. Faced with rising Medicaid expenditures on long-term care, states have attempted to encourage the purchase of private long-term care insurance through partnership programs that exempt purchasers of qualifying policies from the Medicaid asset test. Using numerical optimization techniques, and assuming plausible preference parameters, we show that the programs will only increase insurance coverage among single males by 5 percent and single females by 4 percent. Most of the program benefits will go to those who would have purchased non-partnership long-term care insurance anyway. Thus, the cost of the subsidy will exceed the savings in Medicaid costs. |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:crr:crrwps:wp2013-8&r=age |
| By: | Nicholas-James Clavet; Jean-Yves Duclos; Bernard Fortin; Steeve Marchand |
| Abstract: | Le gouvernement fédéral a annoncé dans son dernier budget son intention de reporter l’âge d’admissibilité aux prestations de la Sécurité de la Vieillesse et de Supplément de Revenu Garanti de 65 à 67 ans. À terme (c’est-à-dire, en 2030), ce report devrait augmenter les revenus nets du gouvernement fédéral de 6,9 milliards de dollars (en dollars constants de 2012), mais diminuer de 620 millions de dollars ceux des provinces. À comportement de travail et d’épargne constant, ce report devrait aussi hausser de 6 % à 17 % le taux de faible revenu des individus de 65 et 66 ans. Des réformes alternatives de la Sécurité de la Vieillesse pourraient permettre d’obtenir des effets semblables en termes de finances publiques sans entraîner pour autant de tels impacts sur les taux de faible revenu des aînés. |
| Keywords: | , Sécurité de la vieillesse, finances publiques, pauvreté |
| Date: | 2013–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2013s-05&r=age |