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on Economics of Ageing |
| By: | Steven G. Allen; Robert L. Clark; Jennifer Maki; Melinda Sandler Morrill |
| Abstract: | Many organizations provide retirement planning seminars to their employees as a benefit to help them make better informed retirement decisions. This study examines the participants in 85 seminars conducted by five companies in 2008 and 2009 to determine how much learning takes place and whether employees adjust retirement plans. Using surveys conducted before and after the seminars, we find that financial literacy and knowledge of retirement program parameters are significantly higher after the seminar. Employees with the largest increases in knowledge were most likely to change their planned retirement age and planned age of claiming Social Security benefits. |
| JEL: | J14 J26 J32 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19231&r=age |
| By: | Bucher-Koenen, Tabea; Kluth, Sebastian (Munich Center for the Economics of Aging (MEA)) |
| Abstract: | One important parameter in the decision process when buying a private annuity is individuals' subjective life expectancy, because it directly influences the expected rate of return. We examine the market for private annuities in Germany and evaluate potential selection effects based on subjective life expectancy. First individuals are pessimistic about their life span compared to the official life tables. Second we find a significant selection effect based on subjective life expectancy for women who invest in private annuity contracts - so-called Riester pensions. For men there seems to be no difference in subjective life expectancy by Riester ownership. Comparing the size of this selection effect with the underlying loading in life expectancy charged by the insurance industry shows that the latter appears to be in line for women but very high for men. Our findings have strong policy implications. On the one hand misperceptions about longevity risk might prevent individuals from providing sufficiently for retirement. On the other hand mandated unisex tariffs might especially discourage men from investing in Riester pensions, for them premiums in life expectancy are particularly high compared to subjective expectations. |
| JEL: | D12 D91 G11 |
| Date: | 2013–05–23 |
| URL: | http://d.repec.org/n?u=RePEc:mea:meawpa:12265&r=age |
| By: | Christopher Ball; John Creedy (The Treasury) |
| Abstract: | This paper investigates the implications of population ageing and changes in labour force participation rates for projections of revenue obtained from personal income taxation and a consumption tax (in the form of a broad-based goods and services tax). A projection model is presented, involving changing age-income profiles over time for males and females. The model is estimated and applied to New Zealand over the period 2011-2062. |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:nzt:nztwps:13/09&r=age |
| By: | Aziz, Omar; Gemmell, Norman; Laws, Athene |
| Abstract: | This paper examines the age and gender dimensions of income distribution and fiscal incidence in New Zealand using Household Expenditure Survey (HES) data for 2010 and a non-behavioural micro-simulation model. Since many fiscal policies are likely to have quite different incidences across age groups and genders, and with population ageing changing the age and gender composition of the voting population in many countries, age/gender dimensions of fiscal incidence become increasingly relevant. While this single ‘age distribution snapshot’ cannot fully capture lifecycle incidences, it avoids the complex and uncertain assumptions implicit in the latter and is an important component of lifetime redistribution calculations. We explore alternative methods of intra-family allocation of resources including ‘unequal share’ assumptions based on recent research into how families allocate their spending. Our evidence, which in general is not highly sensitive to sharing assumptions, suggests a strong ‘life cycle’ aspect to fiscal incidence whereby net tax liabilities are low, and generally negative, at younger and older ages but positive during much of the ‘working age’ period. Women, on average, are found to have a systematically and persistently lower net fiscal liability than men, most pronounced at older ages when greater female longevity exercises a strong influence. Nevertheless, considerable heterogeneity of fiscal incidence for both men and women is observed with the distributions of various fiscal incidence measures showing substantial overlap. |
| Keywords: | Income distribution, Fiscal incidence, Gender, Age, |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:vuw:vuwcpf:2852&r=age |
| By: | Omar A Aziz; Christopher Ball; John Creedy; Jesse Eedrah (The Treasury) |
| Abstract: | This paper examines the potential distributional impacts of demographic change, particularly population ageing, and changes to labour force participation that are projected to arise over the next 50 years. The approach involves calibration weighting of the Treasury’s microsimulation model, Taxwell, based on the New Zealand Household Economic Survey. The weights are adjusted for each projection year to ensure that a range of population aggregates (by age and gender) match the projected values provided by Statistics New Zealand. Measures of income inequality and poverty, along with the incidence of income tax, Goods and Services Tax and a number of components of government spending (namely health and education) across age groups, are obtained. The results suggest that population ageing and expected changes in labour force participation, in isolation, do not have a significant impact on population-level measures of income inequality. |
| Keywords: | Inequality; population ageing; survey calibration; poverty; fiscal incidence |
| JEL: | H24 I14 I24 J1 H24 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:nzt:nztwps:13/13&r=age |
| By: | Groneck, Max; Ludwig, Alexander; Zimper, Alexander (Munich Center for the Economics of Aging (MEA)) |
| Abstract: | On average, "young" people underestimate whereas "old" people overestimate their chances to survive into the future. We adopt a Bayesian learning model of ambiguous survival beliefs which replicates these patterns. The model is embedded within a non-expected utility model of life-cycle consumption and saving. Our analysis shows that agents with ambiguous survival beliefs (i) save less than originally planned, (ii) exhibit undersaving at younger ages, and (iii) hold longer on to their assets than their rational expectations counterparts who correctly assess survival probabilities. Our ambiguity-driven model therefore simultaneously accounts for three important empirical fi…ndings on household saving behavior. |
| JEL: | D91 D83 E21 |
| Date: | 2013–07–02 |
| URL: | http://d.repec.org/n?u=RePEc:mea:meawpa:13270&r=age |
| By: | David Crainich (CNRS-LEM and IESEG School of Management); Louis Eeckhoudt (IESEG School of Management (LEM-CNRS) and and CORE (Université Catholique de Louvain)); James K. Hammitt (Harvard University (Center for Risk Analysis), Cambridge - Toulouse School of Economics (LERNA-INRA)) |
| Abstract: | The relationship between willingness to pay (WTP) to reduce the probability of an adverse event and the degree of risk aversion is ambiguous. The ambiguity arises because paying for protection worsens the outcome in the event the adverse event occurs, which influences the expected marginal utility of wealth. Using concepts of prudence (equivalently, downside risk aversion), we characterize the marginal WTP to reduce the probability of the adverse event as the product of WTP in the case of risk neutrality and an adjustment factor. For the univariate case (e.g., risk of financial loss), the adjustment factor depends on risk aversion and prudence with respect to wealth. For the bivariate case (e.g., risk of death or illness), the adjustment factor depends on risk aversion and cross-prudence in wealth. |
| Keywords: | value per statistical life, mortality risk, risk aversion, prudence |
| JEL: | D8 I1 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:ies:wpaper:e201313&r=age |
| By: | Aurélie Côté-Sergent; Pierre-Carl Michaud |
| Abstract: | Nous utilisons des données d’enquête sur les personnes avec incapacités, jumelées avec les données de la Régie de l’assurance maladie du Québec (RAMQ) sur les dépenses en médicaments, afin de documenter le rôle joué par l’aide formelle et informelle dans la prescription et la consommation de médicaments. Nous nous intéressons d’une part à l’association entre l’aide et la dépense pharmaceutique annuelle totale, et d’autre part à celle entre l’aide et le nombre de prescriptions, nouvelles et renouvelées. L’hypothèse testée est que l’aide au patient peut faciliter l’adhérence au traitement, ce qui peut augmenter la consommation de médicaments. De plus, les médecins peuvent se sentir plus à l’aise de prescrire des médicaments s’ils déterminent que le patient peut être aidé. Nous trouvons une relation positive forte et relativement robuste entre l’aide, en particulier celle provenant des CLSC et de la famille, et la prescription et la consommation de médicaments. Cette relation est intrigante et soulève un nombre de questions intéressantes pour la recherche future. |
| Keywords: | Coûts médicaments, soins à domicile, aînés, invalidité |
| JEL: | J14 I10 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:lvl:lacicr:1316&r=age |