nep-age New Economics Papers
on Economics of Ageing
Issue of 2015‒06‒05
seventeen papers chosen by
Claudia Villosio
LABORatorio R. Revelli

  1. Changing Population In Japan and A Life-Long Active Society To Cope With It By Atsushi Seike
  2. Effect of Labor and Retirement Behavior of the Population in the Long-Term Sustainability of the Pension System in the Russian Federation and the Reduction of Risks of Deprivational Poverty Among the Elderly By Grishina, Elena; Dormidontova, Yulia; Lyashok, Victor; Burdyak, Alexandra; Kazakova, Yuliya; Tsatsura (Kovalenko), Elena
  3. A life-span perspective on life satisfaction By Thieme, Paula; Dittrich, Dennis Alexis Valin
  4. Pension wealth gaps in a system with disintegrated retirement arrangements By Raab, Roman
  5. Seriously Strengthening the Tax-Benefit Link By Pedro Portugal; Pedro S. Raposo
  6. The Political Economy of Public Investment when Population is Aging – A Panel Cointegration Analysis By Philipp Jäger; Torsten Schmidt
  7. Reforming the pension system to increase coverage and equity in Colombia By Christine de la Maisonneuve
  8. Who is saving privately for retirement and how much? New evidence for Germany By Metzger, Christoph
  9. Demographic change in the Asian Century : Implications for Australia and the Region By Peter McDonald
  10. Analytical and Methodical Support of Pension Reform in the Medium and Long Term By Gorlin, Yury; Maleva, Tatiana; Grishina, Elena; Dormidontova, Yulia; Lyashok, Victor
  11. Are Americans of All Ages and Income Levels Shortsighted About Their Finances? By Steven A. Sass; Jorge D. Ramos-Mercado
  12. The Well-Being of Elderly Survivors after Natural Disasters: Measuring the impact of the Great East Japan Earthquake By SUGANO Saki
  13. Problems of Formation and Evaluation of Strategies for Portfolio Investment of Pension Reserves, Accruals and Collective Investments in Russia By Akshentseva, Ksenya; Abramov, Alexander; Chernovà, Maria
  14. Does Retirement Change Lifestyle Habits? By MOTEGI Hiroyuki; NISHIMURA Yoshinori; TERADA Kazuyuki
  15. Take-off, Persistence, and Sustainability : The Demographic Factor of Chinese Growth By Cai Fang, Lu Yang
  16. Distribución espacial de la vejez en Colombia Censo General 2005 By Angela María Jaramillo de Mendoza
  17. Los años de esperanza de vida perdidos en adultos mayores. Bogotá, Cali y Medellín (1999 - 2009) By Óscar Augusto Castellanos Ospina; Doris Cardona Arango

  1. By: Atsushi Seike
    Abstract: Japan's population ageing is unprecedented in modern industrial economies. An ageing population in Japan requires policy measures to encourage lifelong social and economic participation in order to counteract a shrinking workforce and productivity declines. This paper suggests several policy tools, including pension reforms and retirement norms, that could be used to build a 'lifelong active society'.
    Keywords: Demographic Trends, Japanese ageing, Intergenerational Policy
    JEL: J11 J14 J18
    Date: 2015–04
  2. By: Grishina, Elena (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Dormidontova, Yulia (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Lyashok, Victor (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Burdyak, Alexandra (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Kazakova, Yuliya (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Tsatsura (Kovalenko), Elena (Russian Presidential Academy of National Economy and Public Administration (RANEPA))
    Abstract: The aim of this research was to assess the role of employment and retirement behavior of the population in the long-term sustainability of the pension system in the Russian Federation and lovering the risk of deprivational poverty among senior citizens.
    Keywords: employment behavior, retirement behavior, pension system, deprivational poverty
    Date: 2015–06
  3. By: Thieme, Paula; Dittrich, Dennis Alexis Valin
    Abstract: The German population is ageing due to decreasing birth rates and increasing life expectancy. To sustain the German pension system, legal retirement age is increased step by step to 67 years. This raises questions about how to enable and motivate older individuals to work that long. Hence, it is important to understand whether they represent a homogeneous group that can be addressed through specific measures and instruments. Life-span theory points to systematic changes as well as increased heterogeneity with age. For example, work motivation does not generally decline with age but becomes increasingly task-specific, depending on changing life goals and individual adaptation processes in adult development. In this empirical study we analyse age heterogeneity with regard to current life satisfaction and life satisfaction domains (measured as satisfaction with work, income, family and health) that represent personal utilities individuals strive for. For our analysis we use data collected as part of a representative German longitudinal data study (SOEP1). We find increasing heterogeneity in current life satisfaction, satisfaction with work, family life, and health with age. Thus, common mean level analyses on age effects yield only limited informative value. The heterogeneity of older adults should be taken into account when motivating and developing older workers.
    Keywords: Life satisfaction, heterogeneity, life-span, older workers, ageing
    JEL: I10 I31 J14 J20 M50
    Date: 2015–05
  4. By: Raab, Roman
    Abstract: This paper examines the application of the gap concept to determine pension wealth differentials across different retirement arrangements and over a range of retirement ages. The gap concept allows for comparisons of equality outcomes without having to rely on the optimal savings paradigm. The micro simulation analysis draws a clear picture of inequalities generated by a pension system as opposed to other sources of inequality within the generation in retirement.
    Keywords: Personal Income, Wealth, and Their Distributions; Equity, Justice, Inequality, and Other Normative Criteria and Measurement; Retirement and Retirement Policies
    JEL: D31 D63 J26
    Date: 2015–05–15
  5. By: Pedro Portugal; Pedro S. Raposo
    Abstract: On January 1st 1994 Portugal introduced, for the first time, inflation indexation in the old-age pension formula. This change considerably decreased the uncertainty regarding the perception of the link between the stream of labor earnings and future pensions. The effect of indexation was large and, by itself, increased the expected pension amount by 28% in real terms. Individuals appear to have reacted to the policy change: labor earnings increase significantly during the eligible years approaching retirement age.
    JEL: J14 J26 J31
    Date: 2015
  6. By: Philipp Jäger; Torsten Schmidt
    Abstract: Time preferences vary by age. Notably, according to experimental studies, senior citizens tend to discount future payoffs more heavily than working-age individuals. Based on these findings, we hypothesize that demographic change has contributed to the cut-back in government-financed investment that many advanced economies experienced over the last four decades. We demonstrate for a panel of 13 OECD countries between 1971 and 2007 that the share of elderly voters and public investment rates are cointegrated, indicating a long-run relationship between them. Estimating this cointegration relationship via pooled dynamic OLS (D-OLS) and fully modified OLS (FM-OLS) we find a negative and significant effect of population aging on public investment. Moreover, the estimation of an error correction model reveals long-run Granger causality running exclusively from aging to investment. Our results are robust to the inclusion of additional control variables typically considered in literature on the determinants of public investment.
    Keywords: Public investment; population aging; panel cointegration
    JEL: H54 D72 J11 J14
    Date: 2015–05
  7. By: Christine de la Maisonneuve
    Abstract: Colombia is one of the most unequal countries in Latin America. The high level of informality in the labour market and many characteristics of the pension system leave many elderly in poverty. Only formal-sector employees earning more than the relatively high minimum wage are covered. Linking benefits to at least the minimum wage makes the system costly and reduces the provision of annuities by insurance companies as it is difficult to insure against changes in the minimum wage. The Government has recently introduced a matching-contribution scheme (BEPS) for informal workers and vulnerable retiring aged people who have not contributed enough to be entitled to a pension. Moreover, the coverage of the old-age minimum income support has been extended but at the cost of lowering the already modest benefits. More reforms in the pension system are needed to extend coverage while eligibility to the BEPS and the minimum income support should be expanded to guarantee old-age income for more Colombians. In the medium term an in-depth pension reform is required. This Working Paper relates to the 2014 OECD Economic Survey of Colombia. (<P>Réformer le système de retraite colombien pour en augmenter la couverture et l'équité<BR>La Colombie est l'un des pays les plus inégalitaires d'Amérique latine. Le caractère très informel du marché du travail, ajouté à de multiples particularités du système de retraite, laisse bon nombre de personnes âgées dans la pauvreté. Ce dernier, en effet, ne couvre que les employés du secteur formel qui gagnent plus que le salaire minimum, relativement élevé. Le montant des prestations doit s’aligner au moins sur le salaire minimum ce qui rend le système coûteux et réduit le volume des rentes payées par les compagnies d'assurance car il est difficile d’assurer une protection contre les variations du salaire minimum. Le gouvernement a récemment mis en place un régime contributif d’épargne-retraite abondé par l’État (BEPS), destiné aux travailleurs du secteur informel et aux personnes vulnérables prenant leur retraite et n’ayant pas suffisamment cotisé pour avoir droit à une pension. La couverture du revenu minimum vieillesse a été étendue, mais au prix d'une réduction de cette prestation, déjà modeste. De nouvelles réformes du régime de retraite sont nécessaires pour en étendre la couverture, mais il convient également d’élargir les critères d'admissibilité au BEPS et aux prestations du revenu minimum pour garantir un revenu à un plus grand nombre de personnes âgées en Colombie. À moyen terme, une réforme approfondie des retraites va s’imposer. Ce document de travail se rapporte à l’Étude économique 2014 de l’OCDE sur la Colombie. ( ique-colombie.htm).
    Keywords: minimum wage, coverage, inequality, pension system, retirement age, elderly poverty, minimum income support, âge du départ en retraite, Couverture, pauvreté des personnes âgées, système de retraite, salaire minimum, inégalité, revenu minimum
    JEL: H55 I30 J14 J26 J32
    Date: 2015–05–28
  8. By: Metzger, Christoph
    Abstract: Due to demographic change the replacement rates of the German statutory pension scheme will decrease over the next decades. Voluntary savings for retirement will therefore gain more and more relevance in order to maintain one's standard of living during retirement. This article examines the savings behavior for retirement on an individual level in Germany. As a first step the decision to save at all is analyzed, showing that the main determinants for saving are personal income as well as the disposable household income. Furthermore migrants and individuals living in the Eastern part of Germany turn out to be less likely to save additionally privately for retirement. In a second step the chosen gross saving rates are analyzed using a Tobit, a lognormal hurdle model and a Type II Tobit Model. The results suggest that the decisions to save at all and about the saving rate are independent of each other leading to a loss of information if only a standard Tobit model is used. For example personal income increases the probability to save for retirement but decreases the resulting saving rate. Modelling both decisions separately therefore leads to a better understanding of the determinants of saving for old-age.
    Keywords: savings,retirement,life-cycle,two-part model,tobit,exponential type II tobit
    JEL: D14 D91 H31
    Date: 2015
  9. By: Peter McDonald (The Australian National University)
    Abstract: From the demographic perspective, the 21st century is the population ageing century. Population ageing is well underway in all Asian countries as a result of the spectacular falls in both fertility and mortality rates in the second half of the 20th century.
    Keywords: Demographic Trends, Asian Century, Intergenerational Policy
    JEL: J11 J14 J18
    Date: 2015–04
  10. By: Gorlin, Yury (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Maleva, Tatiana (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Grishina, Elena (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Dormidontova, Yulia (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Lyashok, Victor (Russian Presidential Academy of National Economy and Public Administration (RANEPA))
    Abstract: Key conceptual positions and methodological approaches of work as the basis for development projects "Method of calculation of intergovernmental transfers from the federal budget to the budget of the Pension Fund of the Russian Federation" and "Methods of determining the value of a pension factor", which according to the Federal Law of December 15, 2001 ¹167- FZ "On Mandatory Pension Insurance in the Russian Federation" (as amended on December 28, 2013) and the Federal Law of December 28, 2013 ¹400-FZ "On Insurance Pensions" are to be approved by the Russian Government.
    Keywords: pension, the calculation of intergovernmental transfers, method of determining the value of a pension factor
    Date: 2015–04
  11. By: Steven A. Sass; Jorge D. Ramos-Mercado
    Abstract: Americans today are increasingly responsible for saving a substantial portion of their income for retirement. A recent study, however, found that workers are primarily concerned about their ability to satisfy day-to-day needs, not future needs, even if they have their day-to-day finances under control or are financially literate. This brief asks whether this finding also applies at all ages and income levels. The discussion proceeds as follows. The first section introduces the data and methodology. The second section explores whether the financial assessments of young, middle-age, and older workers primarily reflect the household’s ability to meet day-to-day as opposed to distant financial needs. The second section explores the same issue for workers by income. The final section concludes that Americans at all ages and income levels are shortsighted about their finances and on their own cannot be expected to devote much effort to addressing distant financial problems. Given the significantly expanded reliance on household saving, this finding suggests a need to make it easy and automatic for households of all ages and income levels to save enough to secure a basic level of financial well-being in retirement.
    Date: 2015–05
  12. By: SUGANO Saki
    Abstract: The Great East Japan Earthquake of March 11, 2011 had a devastating impact on the northeastern part of Japan. In a quasi-experimental situation, using panel data collected six months after the earthquake from the Japanese Study of Aging and Retirement (JSTAR), this study examines the causal effects of the disaster on both the economic and psychological well-being of elderly survivors affected by the earthquake and tsunami. The results show that the subjective well-being of female survivors in their 60s and of those who had high financial assets significantly dropped. However, people in the other age and gender brackets did not exhibit a significant diminishment in their life satisfaction in the aftermath of the earthquake. These latter results may be due partially to the early economic recovery experienced in the surveyed city six months after the earthquake.
    Date: 2015–05
  13. By: Akshentseva, Ksenya (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Abramov, Alexander (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Chernovà, Maria (Russian Presidential Academy of National Economy and Public Administration (RANEPA))
    Abstract: The present study examined ways to improve the efficiency of portfolio management of pension savings in the Russian Federation. It examined the factors affecting the real return of pension portfolios in different countries; The role of a more liberal requirements on the composition and structure of the portfolio of pension savings, as well as anti-inflationary policy in raising the real rate of return on investment. For the first time on the example of the portfolios of pension savings and mutual funds in Russia is a key role in the profitability of these portfolios factor asset allocation compared with the strategies of active management. Separately considered determinants of stiffness requirements on the composition and structure of assets of pension savings in the different countries, and assess the feasibility of mitigating these requirements for pension funds and asset management companies.
    Keywords: portfolio management, pension savings, pension funds, collective investments
    Date: 2015–05
  14. By: MOTEGI Hiroyuki; NISHIMURA Yoshinori; TERADA Kazuyuki
    Abstract: This paper studies the effect of retirement on lifestyle habits, including drinking, smoking, exercise, and sleeping, by using panel data from the Japanese Study of Aging and Retirement (JSTAR). Rich information in JSTAR enables us to use an interesting instrumental variable to account for endogeneity. We have three contributions in this paper. This is the first paper that focuses on and investigates the mechanism of the relation between retirement and health, namely, lifestyle habits. Second, new results show that people reduce drinking after retirement and increase sleeping time on weekdays although smoking, frequency of exercise, and sleeping time on holidays seem to be unchanged. Third, controlling important factors also allows us to inspect the detailed channels between retirement and lifestyle habits. Our estimation suggests that the peer effect in the workplace may be influential mainly on drinking habits.
    Date: 2015–05
  15. By: Cai Fang, Lu Yang
    Abstract: With the reduction of the working-age population and the increase of the population dependency ratio as the main characteristics of the demographic dividend having disappeared, China’s potential growth rate decreases. And our results suggest that demographic dividend contributed to nearly one forth of the economic growth in China in the past three decades, while TFP growth explains another one third with the remainder mainly due to capital accumulation, explaining nearly half. China’s potential growth rate will slow down—from nearly 10 per cent in the past 30 years to 7.5 per cent on average during 2011-2015—due to the diminished demographic dividend, but reform measures are conductive to clearing the institutional barriers to the supply of factors and productivity, thereby slowing the declining trend of potential growth rate. The aggregate reform dividend (e.g., relax family planning policy, postpone the retirement age, improvement of education and training, tax cut, and improvement of TFP) could reach to 1-2 percentage points on average during 2016-2050.
    Keywords: potential growth rate, Demographic dividend, reform dividend, total factor productivity
    JEL: O47 J21 C53
    Date: 2015–04
  16. By: Angela María Jaramillo de Mendoza
    Abstract: Uno de los principales desafíos socio-demográficos y territoriales que enfrenta el mundo contemporáneo es el envejecimiento demográfico urbano, en el que los asuntos asociados a los entornos ambientales y culturales tendrán un papel cada vez más importante en las políticas sociales y en la planeación urbana. En este documento se considera la relación entre el proceso general de poblamiento en Colombia en el siglo XX y la distribución actual de la vejez. En este texto, se describen las principales características de las personas de 60 años y más en Colombia y sus departamentos, de acuerdo con su distribución urbano-rural, lugar de nacimiento, hogares particulares, lugares especiales de alojamiento y tipo de vivienda. ********** One of the main socio-demographic and territorial challenges facing the contemporary world is urban aging population, in which the issues associated with environmental and cultural environments will have an increasingly important role in social policy and urban planning. This paper considers the relationship between the general process of settlement in Colombia in the twentieth century and the current distribution of oldage. In this text, we describe the main characteristics of persons 60 years and over in Colombia and its Departments, according to urban-rural distribution, birthplace, private households, special places and type of housing accommodation
    Keywords: vejez, distribución espacial, generaciones
    Date: 2013–12–16
  17. By: Óscar Augusto Castellanos Ospina; Doris Cardona Arango
    Abstract: En los últimos tiempos, el mundo ha presenciado un desaceleramiento en el crecimiento poblacional que ha modificado su estructura etaria, generando un aumento del número de efectivos en edades mayores y disminuyendo los menores de 15 años; esto ha sido llamado envejecimiento demográfico. El envejecimiento de la estructura por edad y sexo de la población conlleva a que la morbilidad y la mortalidad tengan cambios, pasando de una alta prevalencia en enfermedades transmisibles y parasitarias a una alta incidencia de enfermedades crónicas y degenerativas sobre este grupo de personas en aumento. El objetivo propuesto fue analizar el perfil de la mortalidad de los adultos mayores en las tres principales capitales de Colombia: Bogotá, Cali y Medellín, entre los años 1999 y 2009, según la lista 6/67 propuesta por la Organización Panamericana de la Salud, comparando su evolución de acuerdo con los años de esperanza de vida perdidos. Para esto, se usaron los registros de defunción y las proyecciones de población de las tres ciudades, obtenidos del Departamento Administrativo Nacional de Estadística de Colombia (DANE). En el procesamiento de datos se calcularon los indicadores: esperanza de vida al nacimiento, años de esperanza de vida perdidos y años de esperanza de vida perdidos según grupo de causas de mortalidad, usando las rutinas LTPOPDTH, AEVP-6085 y DT0805 Population Analysis Spreadsheets (PAS) del U.S. Bureau of the Census. Este comparativo permitió reflexionar sobre la necesidad de contar con información propia y de calidad para cada ciudad, que aporte al direccionamiento de los programas de salud encaminados a reducir la incidencia de la mortalidad, el control de enfermedades y la demanda de servicios, los cuales afectan directamente la calidad de vida y el desarrollo social de los adultos mayores.
    Keywords: mortalidad adulta, años de esperanza de vida perdidos, envejecimiento poblacional.
    Date: 2013–12–16

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