nep-age New Economics Papers
on Economics of Ageing
Issue of 2015‒10‒10
eighteen papers chosen by
Claudia Villosio
LABORatorio R. Revelli

  1. Labor-force participation, policies & practices in an aging America: adaptation essential for a healthy & resilient population By Lisa F. Berkman; Axel Boersch-Supan; Mauricio Avendano
  2. Labor Force Activity after 60: Recent Trends in the Scandinavian Countries with Germany as a Benchmark By Larsen, Mona; Pedersen, Peder J.
  3. Labor Supply Responses to New Rural Social Pension Insurance in China: A Regression Discontinuity Approach By Chen, Zeyuan; Bengtsson, Tommy; Helgertz, Jonas
  4. Impact of Long Term Care for the Elderly in Urban Area of Thailand By thanach kanokthet
  5. "Cult of equity": actuaries and the transformation of pension fund investing, 1948–1960 By Yally Avrahampour
  6. Healthier lifestyles after retirement in Europe? Evidence from SHARE By Martina Celidoni; Vincenzo Rebba
  7. The Financial Support for Long-Term Elderly Care and Household Savings Behaviour By Asako OHINATA; Matteo PICCHIO
  8. Aging, Trade and Migration By Richard Chisik; Harun Onder; Dhimitri Qirjo
  9. The evolution of wealth inequality over half a century: the role of skills, taxes and institutions By Markus Poschke; Baris Kaymak
  10. Long-term care reform and the labor supply of household members: Evidence from a quasi-experiment By Geyer, Johannes; Korfhage, Thorben
  11. Herausforderungen und Besonderheiten der Zielgruppe Silver Surfer im Hinblick auf die Gestaltung eines Webshops By Kalka, Regine; Bär, Greta
  12. The Impact of Rural-Urban Migration on the Health of the Left-behind Parents By Ao, Xiang; Jiang, Dawei; Zhao, Zhong
  13. Passenger Transport in Rural and Sparsely Populated Areas in France By Christophe Saroli
  14. Capitalising on the Grey-haired Globetrotters: Economic Aspects of Increasing Tourism among Older and Disabled People By Ann Frye
  15. Vieillissement de la population active: Vers une baisse de la productivité ? By Sandrine Levasseur
  16. Finite Lifetimes, Population, and Growth By Bharat Diwakar; Gilad Sorek
  17. Cotizaciones en el sistema general de pensiones colombiano: aproximación con un modelo de respuesta binaria By Wilman Carpeta; Jonathan Peña
  18. The changing distribution of individual incomes in the UK before and after the recession By Eleni Karagiannaki; Lucinda Platt

  1. By: Lisa F. Berkman; Axel Boersch-Supan; Mauricio Avendano
    Abstract: Population aging in the United States poses challenges to societal institutions while simultaneously creating opportunities to build a more resilient, successful, and cohesive society. Work organization and labor-force participation are central to both the opportunities and challenges posed by our aging society. We argue that expectations about old age have not sufficiently adapted to the reality of aging today. Our institutions need more adaptation in order to successfully face the consequences of demographic change. Although this adaptation needs to focus especially on work patterns among the “younger elderly,” our society has to change its general attitudes toward work organization and labor-force participation, which will have implications for education and health care. We also show that work's beneficial effects on well-being in older ages are often neglected, while the idea that older workers displace younger workers is a misconception emerging from the “lump-of-labor” fallacy. We conclude, therefore, that working at older ages can lead to better quality of life for older people and to a more productive and resilient society overall.
    JEL: R14 J01
    Date: 2015
  2. By: Larsen, Mona (Danish National Centre for Social Research (SFI)); Pedersen, Peder J. (Aarhus University)
    Abstract: In most OECD member countries labor force attachment has increased in recent years in the 60+ group. Focus in the paper is on the development in this area in Denmark, Norway and Sweden since the 1990s. The development in the same period in the German labor market is included as a frame of reference. Main emphasis is given to the development in two distinct age groups, i.e. people in the first half of the 60s of which many are eligible for early retirement programs and people older than 65 mostly eligible for social security retirement programs. For these two age groups the actual development in labor force participation is described based on register data and on labor force surveys along with indicators of cohort relevant changes in education and health. Focus in the paper includes also the gender aspect to accommodate stronger cohort effects for women than for men. The impact on labor force participation from individual education and from self-assessed health is analyzed based on available micro data. Policy reforms and changes in the retirement area have been enacted since the mid-1990s in the included countries and more sweeping reforms are enacted or under review for the years ahead. We include a brief survey of policy changes in the Scandinavian countries and Germany as other determinants of labor force participation in the 60 and older group.
    Keywords: employment, older workers, health, education, program changes
    JEL: I15 I25 J14 J26
    Date: 2015–09
  3. By: Chen, Zeyuan (Lund University); Bengtsson, Tommy (Lund University); Helgertz, Jonas (Lund University)
    Abstract: Transitioning into retirement is an under-researched phenomenon in developing countries. Largely, this is linked to a predominance of contexts where – in particular – the rural population remains outside the coverage of any formal pension system. In 2008, China introduced the New Rural Social Pension (NRSP), a program which by now covers the majority of the Chinese rural elderly. This paper examines the effects of the NRSP on the labor supply of the elderly in rural China. As pension benefit eligibility at the time of its implementation is conditional on age, a regression discontinuity design is applied to investigate the casual effect of the receipt of pension benefits on labor supply. Furthermore, as the NRSP is neither means-tested nor conditions on retirement, it induces a pure income effect on employment. Using data from the China Health and Retirement Longitudinal Study, a nationally representative data set, we find that the receipt of pension benefits increases the probability of retirement among the rural elderly by around 15%.
    Keywords: China, New Rural Social Pension, labor supply, regression discontinuity, retirement
    JEL: H55 J26
    Date: 2015–09
  4. By: thanach kanokthet (Naresuan University)
    Abstract: This study was a qualitative research aiming to study the experience of long-term care, its associated impact as well as the role of organizations involved in long – term care for the elderly. Data were collected, from January of 2015 to June of 2015, through in-depth interview, focus group discussion, and direct observation of 362 elderly persons and 85 caregivers, at 6 municipality of four provinces of Thailand. The data were analyzed using content analysis, thematic analysis, and frequency and percentage.The results of long-term dependency of the elderly with stroke, dementia, co-morbidity, and chronic health problem, were documented. The care givers who provided long-term care for the elderly in Urban Area showed that the majority of them feel relative powerless; most of them (85%) were female; 30 percent had a chronic health problem; and 35 percent were elderly caregivers. 70 percent of caregivers also work, about 15 percent people need to provide long-term care for more than one person, it was found that the pattern of family caregivers for long-term elderly care in Urban Area of Thailand that the caring was subject of gratitude.Regarding the effect of care, Half of caregivers who care for the elderly with stroke and co-morbidity experienced the economic burden, due to costs of care, financial debt, and a lack of opportunities for career development.The psychological burden and emotional problems were the most common ,among those who provided care to elderly people with dementia. there is a lack of continuity of care for the elderly in the long term health care system, a lack of assurance for the quality of home care, and the lack of integration of missions of the organizations involved in the care of the elderly in a community.In conclusion, the long-term care for the elderly in Thailand results in tremendous burden on caregivers and families amidst the unavailability of family and community support systems. Therefore, support system development and system design for long-term elderly care options for caregivers and families in the community include; development of primary care services, promote the role of local government in the long term care system for the elderly, development potential family caregivers, and standardization and quality control long-term elderly care nationality.Thus, leading to the development of a sustainable aged care that is in accord with urban area of Thailand.
    Keywords: Long Term Care , Elderly ,Urban Area
    JEL: I14 I18 I19
  5. By: Yally Avrahampour
    Abstract: This article examines the mid-twentieth-century transformation of U.K. pension fund investment policy known as the “cult of equity.” It focuses on the influence exercised by the Association of Superannuation and Pension Funds over actuarial and corporate governance standards, through actuaries who were members of its council. This intervention led to increasingly permissive actuarial valuations that reduced contributions for sponsors of pension funds investing in equities. Increased demand for equities required pension funds to adopt a more permissive approach to corporate governance than insurance companies and investment trusts, and contributed to declining standards of corporate governance.
    JEL: E6
    Date: 2015
  6. By: Martina Celidoni (University of Padova); Vincenzo Rebba (University of Padova)
    Abstract: This paper investigates changes in health behaviours upon retirement, using data drawn from the Survey of Health Aging and Retirement in Europe (SHARE). By exploiting changes in eligibility rules for early and normal retirement, we identify the causal effect of retiring from work on smoking, alcohol drinking, engagement in physical activity and visits to the general practitioner or specialist. We provide evidence about heterogeneous effects related to gender, education, net wealth, early-life conditions and job characteristics. Results show that changes in health behaviours occur upon retirement and may be a key mechanism through which the latter affects health. We find heterogenous effects related especially to gender, education and job characteristics.
    Keywords: retirement, health behaviour, fixed effects, instrumental variables.
    JEL: I12 J14 J26
    Date: 2015–09
  7. By: Asako OHINATA (University of Leicester, UK, Department of Economics); Matteo PICCHIO (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali)
    Keywords: Long-term elderly care, ageing, difference-in-difference, means tested financial support, saving, wealth
    JEL: C21 D14 I18 J14
    Date: 2015–09
  8. By: Richard Chisik (Department of Economics, Ryerson University, Toronto, Canada); Harun Onder (The World Bank); Dhimitri Qirjo (Department of Economics & Finance, SUNY Plattsburgh)
    Abstract: We consider the role of demand driven changes arising from popula- tion aging and how they aect the pattern of international trade as well as trade and immigration policy. An aging society can see a wel- fare reducing reduction in its share of manufacturing output and this reduction is magnied by a decrease in trade costs (an increase in glob- alization). Immigration can ameliorate this outcome if it is directed towards younger immigrants. A unilateral tari increase can also re- duce rm delocation from aging country, however, a reciprocated tari increase will unambiguously harm the country with the older average population.
    Keywords: Demographic Transition, Consumption, Trade Policy, Immigration Policy.
    JEL: F12 J14 F22
    Date: 2015–10
  9. By: Markus Poschke (McGill University, Montreal); Baris Kaymak (Universite de Montreal)
    Abstract: Over the last 50 years, the US economy saw significant changes in its fiscal structure. Notable among these are the introduction and expansion of social security programs and Medicare, and the transformation of the tax system. These institutional changes took place against a backdrop of developments in the technology of production that increasingly favored skilled workers.In this paper, we analyze how the interplay between these institutional and technological factors might have shaped the distributions of income, wealth, consumption and welfare. We find that while changes in income inequality are mostly attributable to technological factors, the increase in wealth inequality has further been compounded by the expansion of social security and Medicare, which have reduced saving incentives for retirement, in particular for low and middle income groups. As a result, they have substantially increased wealth concentration in US. Results suggest that approximately 25% of the rise in the share of wealth held by the wealthiest 1% is explained by larger transfers to senior population.
    Date: 2015
  10. By: Geyer, Johannes; Korfhage, Thorben
    Abstract: Germany introduced a new mandatory insurance for long-term care in 1995 as part of its social security system. It replaced a system based on means tested social welfare. Benefits from the long-term care insurance are not means tested and depend on the required level of care. The insurance provides both benefits in kind and cash benefits. The new scheme improved the situation for households to organize informal care at home. This was one goal of the reform since policymakers view informal care as a cost-saving alternative to formal care. This view however neglects possible opportunity costs of reduced labor supply of carers. We exploit this reform as a quasi-experiment and examine its effect on the labor supply of caregivers who live in the same household as the care recipient. We find strong negative labor market effects for men but not for women. We conduct a series of robustness tests and find results to be stable.
    Abstract: Im Jahr 1995 wurde in Deutschland eine neue Pflegeversicherung eingeführt. Als Pflichtversicherung ist sie eine eigenständige Säule der Sozialversicherung und ersetzte ein System der einkommensabhängigen Sozialhilfe. Leistungen der neuen Pflegeversicherung werden durch den Grad der Pflegebedürftigkeit bestimmt und sind einkommensunabhängig. Da anspruchsberechtigte Pflegebedürftige zwischen Geld- und Sachleistungen wählen können, wurde die Situation von Haushalten, die häusliche, informelle Pflege organisieren müssen verbessert. Die informelle Pflege zu stärken war eines der wichtigsten Ziele der Pflegereform, da sie häufig als die kostengünstige Alternative im Vergleich zu formellen Pflege wahrgenommen wird. Diese Sichtweise ignoriert jedoch Opportunitätskosten, die entstehen, wenn Pflegende ihr Arbeitsangebot reduzieren, um die Doppelbelastung aus Pflege und Lohnarbeit abzuschwächen. Wir nutzen die Reform als Quasi-Experiment und untersuchen ihren Einfluss auf das Arbeitsangebot von Pflegenden, die mit einer pflegebedürftigen Person in einem Haushalt wohnen. Wir finden starke negative Arbeitsangebotseffekte für Männer, jedoch keine Effekte für Frauen.
    Keywords: labor supply,long-term care,long-term care insurance,natural experiment,quasi-experiment
    JEL: J22 H31 I13
    Date: 2015
  11. By: Kalka, Regine (Department of Economics of the Duesseldorf University of Applied Sciences); Bär, Greta (Department of Economics of the Duesseldorf University of Applied Sciences)
    Abstract: This article discusses the conception of a website for a target group of internet users over the age of 60. Therefore, in order to understand the issue, the target group is first evaluated more precisely. Then, the analysis goes on with the development of the term ’Silver Surfer’ and the growing importance of the target group in German society. This article focuses on the target group’s potential, which is characterized by ongoing shifts of the age structure within the German population, as well as the financial development of the target group. Moreover, physical and mental circumstances distinguish the target group from other groups in the population based on biological aging, their changes of the life situation, and their moral values. The essence of this article will be a research study of determining the challenges and characteristics of the target group silver surfer. A Conjoint-analysis is used to analyze the results statistically. For that, a description of its structure and design is followed by an explanation of its implementation. Afterwards, the study will focus on the results, which are characterized by the analysis of individual design specifications, as well as the importance of each element analyzed. Then, the article will compare the results of the target group aging from 60 to 70 years, with the results of the target group over 70 and is followed by a comparison between the results of male and female silver surfers. The article is completed by meaningful recommendations for actions of a realistic and practical application of the results. Those show that a silver surfer’s evaluation is influenced by every single design element of a web shop.
    Abstract: Dieser Artikel befasst sich mit der zielgruppengerechten Ansprache von Internetnutzern ab 60 Jahren zur Gestaltung eines Webshops. Dafür wird zunächst die Zielgruppe genauer betrachtet. Diese Analyse beginnt mit der Entwicklung des Begriffs "Silver Surfer" und der wachsenden Bedeutung der Zielgruppe. Der Fokus wird bei dieser Erarbeitung auf das Potenzial der Zielgruppe gelegt, welches sich sowohl durch die Veränderung der deutschen Altersstruktur als auch der finanziellen Entwicklungen der Altersgruppe ab 60 Jahren herausstellt. Die Zielgruppe charakterisiert sich außerdem durch deren physische und psychische Gegebenheiten, die durch das kalendarische Altern als auch durch die Veränderung der Lebenssituation und deren moralischen Werte bestimmt sind. Als Kern dieses Artikels wird anschließend die Untersuchung zur Ermittlung der Herausforderungen und Besonderheiten der Zielgruppe der Silver Surfer erläutert. Als Methodik soll dabei eine Conjoint-Analyse dienen. Deren Aufbau und Gestaltung wird eingehend erläutert. Der Fokus wird anschließend auf die Ergebnisse dieser Untersuchung gelegt, welche sich durch die Betrachtung einzelner Ausprägungen der verschiedenen Gestaltungselemente als auch der übergeordneten Wichtigkeiten der Elemente charakterisiert. Anschließend wird ein Vergleich der Ergebnisse der Zielgruppen von 60 bis 70 Jahren, sowie der Zielgruppe über 70 Jahren dargestellt. Darauf folgt der Vergleich zwischen Ergebnissen der männlichen und weiblichen Silver Surfern. Abschließen wird dieser Artikel mit aussagekräftigen Handlungsempfehlungen für ein reales und praktisches Umsetzen der gewonnenen Ergebnisse. Diese zeigen, dass Silver Surfer alle Gestaltungselemente eines Webshops in ihre Bewertung einfließen lassen.
    Keywords: Webshop, Design, Silver Surfer, E-Commerce, Elderly, Webshop, Gestaltung, Silver Surfer, E-Commerce, Senioren
    JEL: L81 M30
    Date: 2015–08
  12. By: Ao, Xiang (Renmin University of China); Jiang, Dawei (Renmin University of China); Zhao, Zhong (Renmin University of China)
    Abstract: Since the reform and opening up in 1978, China has begun a period of rapid industrialization and urbanization. Along with an increasing number of rural people migrating to urban area for jobs, there are a considerable number of elderly parents left behind in the rural area. The impact of migration of the adult children on the health of their left-behind parents is ambiguous. On the one hand, the additional income from the children's jobs can allow their parents to afford better health care and nutrition; on the other hand, the migration necessarily reduces the amount of time the children have to take care of their parents. This paper uses the Rural Urban Migration in China data to empirically investigate the effect of adult children's migration on the health of the left-behind parents. Based on a linear probability model with instrumental variable correction, we find that having one additional adult child migrated to an urban area increases the probability of the left-behind elderly parents being in poor health condition by about 8%. Furthermore, parents having only one child, from low-income households, or aged above 60 years are affected more. Our results point out that the parents with only one child is the most vulnerable group and highlight the importance of establishing a formal care system for the rural elderly to complement the traditional family care in rural China.
    Keywords: left-behind parents, health, rural-urban migration, China
    JEL: O15 J14 I15
    Date: 2015–09
  13. By: Christophe Saroli
    Abstract: Improving mobility is a major issue in sparsely populated areas. The low population density in these localities often means that longer journeys are required to access services, carry out everyday activities or maintain social links. Whole sections of the population – in particular older people, young people, stay-at-home parents in single-car households, and seasonal workers – are effectively handicapped in mobility terms by inadequate public transport provision and an overdependence on people who have cars.
    Date: 2015–03
  14. By: Ann Frye
    Abstract: This paper explores the impact of demographic trends on the market for tourism and considers how the economic power of older tourists is being – or could be – harnessed to maximise the potential both for visitors and domestic populations. The paper also suggests strategies to capitalise more effectively on this significant and growing market for the benefit, not only of the tourism market but also for domestic populations.
    Date: 2015–04
  15. By: Sandrine Levasseur (OFCE)
    Abstract: Le vieillissement de la population active pose des défis importants pour notre potentiel de productivité macroéconomique notamment si, comme certains l'avancent, la productivité au travail diminue à partir d’un certain âge. Dans cet article, nous nous intéressons tout d’abord aux résultats des études de neurosciences portant sur l’évolution des capacités cognitives (et physiques) chez le sujet vieillissant. Puis, nous passons en revue la littérature empirique sur le lien entre âge et productivité au travail. Nous concluons que si la littérature fait consensus sur la baisse des capacités cognitives et physiques au fur et à mesure du vieillissement, il n’en va pas de même pour le lien empirique entre âge et productivité au travail. Enfin, dans le cadre d’un travail statistique simple, nous avons analysé les réponses actuelles au vieillissement de la population active en termes de robotisation et de recours à l’immigration. Nous trouvons que la densité robotique est positivement et significativement corrélée au vieillissement de la population active future tandis que l’immigration au cours des vingt dernières années a considérablement ralenti le vieillissement de la population de certains pays développés. Finalement, notre potentiel de productivité macroéconomique nous semble moins lié au vieillissement de la population active qu’aux progrès de la robotique et de l’intelligence artificielle.
    Keywords: Vieillissement; population active; productivité; capacités cognitives; robotisation ; immigration
    Date: 2015–09
  16. By: Bharat Diwakar; Gilad Sorek
    Abstract: This work highlights principle differences in the predictions of R&D-based growth theory derived from the infinite horizon framework and the Overlapping Generations (OLG) framework of finitely living agents. In particular we show that the counterfactual positive effect of population growth on output growth presented in the second and third generation R&D-based growth models is eliminated in the corresponding OLG framework with finitely living agents. These differences arise because of the limiting effect of labor income on saving that presents only in the OLG framework. Our results indicate that the counterfactual relations between population and output growth rates presented in current R&D-based growth models are driven by their specific demographic structure.
    Keywords: R&D, Growth; Population; Overlapping Generations
    JEL: O31 O40
    Date: 2015–09
  17. By: Wilman Carpeta; Jonathan Peña
    Abstract: En un país como Colombia el problema de cotización en el Sistema General de Pensiones es bastante complejo si se considera que la relación entre la cantidad de personas que cotizan respecto a la población económicamente activa es muy baja, y en particular cuando se encuentran las estimaciones del Ministerio de Trabajo indicando que el 90 % de los ocupados del país no logrará pensionarse, cifra bastante alarmante. De ahí la insistencia de reconocer los determinantes sobre la probabilidad de cotizar en el sistema de pensiones colombiano y a partir esto inferir sobre aquellos que resultan importantes y descartar los que no lo son, a través del diseño de un modelo Probit. Además este documento muestra la importancia de reformar el sistema y buscar alternativas de protección para la vejez.
    Keywords: Sistema General de Pensiones, Cotizaciones de pensiones, Modelos Probit, Colombia
    JEL: C25 H55 J14 J26
    Date: 2015–09–30
  18. By: Eleni Karagiannaki; Lucinda Platt
    Abstract: While there has been substantial research on the impacts of the Great Recession on household incomes, there has been less attention paid to the effects on individual income. Using pooled data from the Family Resources Survey, we address the question of which groups gained and which lost in terms of their individual income between 2005-8 and 2009-12. We investigate changes in median individual incomes and across the distribution by age, ethnicity, social class and housing tenure. We also explore the role of different income sources in overall income changes. We find that working age men faced lower individual incomes across the distribution after the recession compared to the earlier period. By contrast, pensioners' incomes were protected. Working age women overall experienced individual income gains that largely came from higher labour income; but the pattern was more varied, with some groups of women losing out. The income gains that women in couples obtained were not sufficient to counterbalance the losses that men experienced.
    Keywords: individual incomes, Great Recession, income distribution, UK, working age, pensioners, gender, ethnicity, housing tenure
    JEL: D31
    Date: 2015–09

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