nep-age New Economics Papers
on Economics of Ageing
Issue of 2014‒07‒28
six papers chosen by
Claudia Villosio
LABORatorio R. Revelli

  1. What effect does increasing the retirement age have on the employment rate older women? Empirical evidence from retirement age hikes in Hungary during the 2000s By Zsombor Cseres-Gergely
  2. Workplace Health Promotion and Labour Market Performance of Employees By Huber, Martin; Lechner, Michael; Wunsch, Conny
  3. Migration in Italy is Backing the Old Age Welfare By Del Boca, Daniela; Venturini, Alessandra
  4. Is it all about access? Perceived access to occupational pensions in Germany By Lamla, Bettina; Coppola, Michela
  5. The Persistence and Heterogeneity of Health among Older Americans By Florian Heiss; Steven F. Venti; David A. Wise
  6. The Cost of Pollution on Longevity, Welfare and Economic Stability By Natacha Raffin; Thomas Seegmuller

  1. By: Zsombor Cseres-Gergely (Institute of Economics, Center for Economic and Regional Studies, Hungarian Academy of Sciences)
    Abstract: This paper provides empirical evidence on the effect of changing the retirement age on employment. Base on individual data from Hungary, a country where a number of hikes increased the retirement age between 1997 and 2009, this analysis benefits from substantial variation in pension eligibility during a relatively short time. It is based on a difference-in-difference approach and supported by independent variation in the age-based eligibility rule contributing to the causal identification of the effect. Results suggest that the effect of the changes in early retirement age is substantial, amounting to 5-7.4 percentage point increase in the 45 per cent employment rate at the retirement age for women. Changes in the normal retirement age do not seem to have such employment effect because increases in disability pension claims have counteracted them.
    Keywords: retirement age, older workers, employment
    JEL: H31 H55 J14 J26
    Date: 2014–04
  2. By: Huber, Martin (University of St. Gallen); Lechner, Michael (University of St. Gallen); Wunsch, Conny (University of Basel)
    Abstract: This paper investigates the average effects of (firm-provided) workplace health promotion measures in form of the analysis of sickness absenteeism and health circles/courses on labour market out-comes of the firms' employees. Exploiting linked employer-employee panel data that consist of rich survey-based and administrative information on firms, workers and regions, we apply a flexible propensity score matching approach that controls for selection on observables as well as on time-constant unobserved factors. While the effects of analysing sickness absenteeism appear to be rather limited, our results suggest that health circles/courses increase tenure and decrease the number of job changes across various age groups. A key finding is that health circles/courses strengthen the labour force attachment of elderly employees (51-60), implying potential cost savings for public transfer schemes such as unemployment or early retirement benefits.
    Keywords: firm health policies, health circles, health courses, analysis of sickness absenteeism, matching
    JEL: I10 I19 J32
    Date: 2014–06
  3. By: Del Boca, Daniela (University of Turin); Venturini, Alessandra (University of Turin)
    Abstract: Our research analyzes the effect of changes in migration policies and the accession to the European Union of former countries of emigration, considering the crucial role played by migrants in an aging society. We focus on the demand of family-care workers by using the last five years of the Italian Labour Force Survey dataset. Our results show that especially during the last years of recession, foreign labor (mostly female) has become fundamental in the family sector, favoring the participation of Italian skilled women in the labor market.
    Keywords: migration, aging, women's work
    JEL: J6 J15
    Date: 2014–07
  4. By: Lamla, Bettina; Coppola, Michela (Munich Center for the Economics of Aging (MEA))
    Abstract: This paper provides an empirical analysis of what determines access to occupational pensions as perceived by workers. We investigate this issue in Germany, where workers have the legal right to an occupational pension since 2001, but many might lack the incentive or the ability to gather and process the relevant information to make use of their right. In particular, if workers rely exclusively on the information available at their firm, employers will continue to regulate access despite workers’ rights. Our findings suggest that the current regulation in Germany has not resolved the problem of workers’ ignorance of their access to occupational pensions. Only about half the workers are aware of having access to an occupational pension. We find that there is important heterogeneity in workers’ perceptions, and that this heterogeneity is directly related to worker and firm-side factors as well as outcomes of the employer-employee match. Distorted perceptions have important consequences for workers, policy makers and firms. Workers can only make optimal savings decisions if they are aware of their savings possibilities. Policy makers could help by making information material about occupational pensions mandatory and/or by defining standardised information. A low level of knowledge of employees might also be frustrating for employers, as this would suggest that workers do not appreciate their occupational pension, limiting the power of occupational pension as a Human Resources tool.
    JEL: J26 D83
    Date: 2013–12–11
  5. By: Florian Heiss; Steven F. Venti; David A. Wise
    Abstract: We consider how age-health profiles differ by demographic characteristics such as education, race, and ethnicity. A key feature of the analysis is the joint estimation of health and mortality to correct for the effect of mortality selection on observed age-health profiles. The model also allows for heterogeneity in individual health at a point in time and the persistence of the unobserved component of health over time. The observed component of health is based on a multidimensional index based on 27 indicators of health. Most of the key results are shown by simulations that illustrate the range of issues that can be addressed using the model. Differences in health by education and racial-ethnic group at age 50 persist throughout the remainder of life. Based on observed profiles, the health of whites is about 8 percentile points greater than the health of blacks at age 50 but by age 90 the gap is only 5 percentile points. However, when corrected for mortality selection, the health of blacks is actually declining more rapidly with age than the health of whites; the true gap widens with age. We also find that much of the difference in age-health profiles by racial-ethnic group is accounted for by differences in the levels of education between race-ethnic groups--from two-thirds to 85 percent for men and about half for women. We also simulate differences in survival probabilities by level of education and health and use these probabilities to calculate the expected present discounted value (EPDV) of an immediate annuity with first payout at age 66 for persons by gender, level of education, and health decile. The range of EPDVs is over two-fold for both men and women suggesting enormous potential for adverse selection.
    JEL: I10 I19 J14
    Date: 2014–07
  6. By: Natacha Raffin (EconomiX - CNRS : UMR7166 - Université Paris X - Paris Ouest Nanterre La Défense, Climate Economics Chair - University Paris Dauphine); Thomas Seegmuller (AMSE - Aix-Marseille School of Economics - Centre national de la recherche scientifique (CNRS) - École des Hautes Études en Sciences Sociales (EHESS) - Ecole Centrale Marseille (ECM))
    Abstract: This paper presents an overlapping generations model where pollution, private and public healths are all determinants of longevity. Public expenditure, financed through labour taxation, provide both public health and abatement. We study the complementarity between the three components of longevity on welfare and economic stability. At the steady state, we show that an appropriate fiscal policy may enhance welfare. However, when pollution is heavily harmful for longevity, the economy might experience aggregate instability or endogenous cycles. Nonetheless, a fiscal policy, which raises the share of public spending devoted to health, may display stabilizing virtues and rule out cycles. This allows us to recommend the design of the public policy that may comply with the dynamic and welfare objectives.
    Keywords: longevity; pollution; welfare; complex dynamics
    Date: 2014–07

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