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on Economics of Ageing |
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| By: | Martin F. Lueken (Friedman Foundation for Educational Choice); Michael Podgursky (University of Missouri, Department of Economics) |
| Abstract: | This paper examines pension benefit choices made by public school teachers vested in the Illinois Teachers’ Retirement System (TRS) who quit teaching well before retirement eligibility. Teachers who separate have the option of keeping their funds in TRS and collecting a pension at a future date or withdrawing them (“cashing out†). We examine how variation in pension wealth at separation affects this decision, what that reveals about individual discount rates, and how these decisions are affected by teacher characteristics such as race and gender. Results from cash out models suggest higher discount rates among male, African American, and Hispanic teachers; teachers who work in rural districts; and teachers who did not receive a degree from an elite institution in Illinois. Groups who are more likely to cash out are also less likely to roll over their contributions to an IRA or similar tax-advantaged savings vehicles. Since Illinois teachers are not covered by Social Security (as teachers), the latter finding suggests that many exiting teachers may be at risk of inadequate retirement savings. |
| Keywords: | Pensions, Teacher Pensions, Teacher Labor Markets |
| JEL: | I2 J6 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:umc:wpaper:1605&r=age |
| By: | Oshio, Takashi; Usui, Emiko; Satoshi Shimizutani |
| Abstract: | Japan experienced increases in labor force participation (LFP) of the elderly in recent years, as have other advanced countries. In the present study, we overview the employment trend of the elderly in Japan, and examine what factors have contributed to its increase since the early 2000s. Improved health and longevity, increasing education levels, and a shift towards less physically demanding jobs have allowed the elderly to stay longer in the labor force. However, elderly employment rebound and its timing are more closely linked to changes in social security incentives, especially increases in the eligibility age for public pension benefits. More broadly, reduced generosity in social security programs since the mid-1980s has been a key driver of the long-term trend change in elderly employment. A series of social security reforms have helped utilize the elderly's potential work capacity, accumulated due to improving health conditions and other favorable factors for LFP in the elderly. |
| Date: | 2016–04 |
| URL: | http://d.repec.org/n?u=RePEc:hit:cisdps:656&r=age |
| By: | Symeonidis, Georgios |
| Abstract: | In 2010, Greece, under the pressure of an increasing public debt, was forced to resort to the Troika, which is the designation of the triumvirate which comprises the European Commission (EC), the European Central Bank (ECB) and the International Monetary Fund (IMF). The Troika agreed to provide Greece with financial help, on special terms recorded in a Memorandum of Understanding (MoU) between the Greek Government and the Troika. One of the most important reforms that are recorded in the MoU is the Pension Reform since the Greek Social Security System had long showed signs of unsustainability and insolvency. The recession also caused further impoverishment of old-age people followed by the rest of the population and this became one of the main reasons that the reforms could not be fully implemented for fear of further impoverishment of pensioners and social exclusion in general, as well as political cost which is always a key factor. This paper aims to further analyze and present the impact of the reforms on the Greek Pension System and the people who rely on it, through an actuarial, statistical analysis and point out the changes in the main factors mentioned above and how they correlate. |
| Keywords: | Debt Markets,Safety Nets and Transfers,Emerging Markets,Pensions&Retirement Systems,Gender and Law |
| Date: | 2016–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:hdnspu:105821&r=age |
| By: | Financial Statistics Group, Economic Statistics Division, Research and Statistics Department (Bank of Japan) |
| Abstract: | In light of an increased importance of statistics related to the nonbanking sector -- such as corporate pensions and investment trusts -- with the rapidly ageing of Japan's population and a trend shift "From Saving to Investment" promoted by the government and industries, the Bank of Japan has made substantial revisions to Japan fs Flow of Funds Accounts for the first time since 1999. Highlights of the revisions are: (1) regarding corporate pensions, defined benefit schemes and defined contribution schemes are recorded separately as independent sectors, and the discounted present value of future benefits based on the actuarial calculation of pensions is recorded as pension entitlements and (2) regarding investment trusts, distributions from the principal are recorded not as income but as outflows of funds from investment trusts. As a result, issues of the balance between assets and liabilities of pension funds and distribution amounts from the principal of investment trusts are brought to the fore, allowing to capture financial surplus and deficits of households and private nonfinancial corporations in a more accurate fashion. This makes it possible for Japan's Flow of Funds Accounts to produce a more accurate picture of financial activities than those furnished by other advanced countries. |
| Date: | 2016–05–25 |
| URL: | http://d.repec.org/n?u=RePEc:boj:bojrev:rev16e03&r=age |
| By: | Bárány, Zsófia (SciencesPo Paris); Coeurdacier, Nicolas (SciencesPo Paris and CEPR); Guibaud, Stéphane (SciencesPo Paris) |
| Abstract: | The neoclassical growth model predicts large capital flows towards fast-growing emerging countries. We show that incorporating fertility and longevity into a lifecycle model of savings changes the standard predictions when countries differ in their ability to borrow inter-temporally and across generations through social security. In this environment, global aging triggers capital flows from emerging to developed countries, and countries’ current account positions respond to growth adjusted by current and expected demographic composition. Data on international capital flows are broadly supportive of the theory. The fact that fast-growing emerging countries are also aging faster, while having less developed credit markets and pension systems, explains why they are more likely to export capital. Our quantitative multi-country overlapping-generations model explains a significant fraction of the patterns of capital flows, across time and across developed and emerging countries. |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:ihs:ihsesp:321&r=age |
| By: | Albertini,Marco |
| Abstract: | At the beginning of the twenty-first century, intergenerational relations remain a key aspect of the future development and sustainability of the European social model. In the present paper, patterns of intergenerational support and the main driving factors behind individuals'transfer behavior are explored. In particular, the data form the Survey of Health, Ageing, and Retirement in Europe are utilized to shed light on the main factors behind the likelihood and intensity of social support, and financial help provided to and received from other family members by ageing and elderly Europeans. The analysis also takes into consideration patterns and factors correlated with grandparenting activities. Finally, special attention is devoted to the condition of those individuals who are sandwiched between care obligations toward their elderly parents and young adult children. It is shown that the likelihood of the exchange of support between family generations is highest in Scandinavian countries and lowest in Southern Europe. The intensity of support follows an opposite North-South gradient. In addition, relevant gender-related inequalities are documented. In general, time-demanding support obligations are more likely to fall on the shoulders of women in the early stage of their later life, while mainly benefitting elderly men. |
| Keywords: | Population&Development,Gender and Social Development,Gender and Law,Health Monitoring&Evaluation,Population Policies |
| Date: | 2016–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:7678&r=age |
| By: | Quitterie Roquebert (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics); Roméo Fontaine (LEDi - Laboratoire d'Economie de Dijon - UB - Université de Bourgogne - CNRS - Centre National de la Recherche Scientifique); Agnès Gramain (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | With population ageing, the demand for home care of the disabled elderly is increasing and a large part of care is provided by informal caregivers. This paper focuses on the determinants of care provision by children to an old, single and disabled parent. We focus on two-child families and apply a semi-structural methodology, already implemented on European data (survey SHARE). It makes it possible to distinguish between two types of determinants: structural determinants (individual, parental and family characteristics) and interactions (effect of the care provision of one child on the care provision of the other). The estimation of this model on data of the French survey "Handicap Santé Ménages" (2008) highlights two distinct behaviors according to sibling rank. Indeed, if the care decisions of both children are sensitive to the characteristics of their parent, the older child reacts more on the sibling composition, whereas the younger child's decision is much more influenced by her personal characteristics. Interactions are found to be asymmetric: when the sibling provides care, the elder is more likely to be caregiver, whereas it is the reverse for the younger child. These differences are interpreted as follows: in two-child families, the older child provides care as a response of a socially-assigned role, whereas the younger child decides through a trade-off between the advantages and the opportunity costs of care provision. |
| Abstract: | Cet article étudie les déterminants des décisions d'aide de la part des membres d'une fratrie de deux enfants à l'égard d'un parent âgé, seul et dépendant. L'application d'une méthodologie semi-structurelle, déjà utilisée sur données européennes (enquête SHARE), permet de distinguer les déterminants structurels (individuels et familiaux) et les interactions (influence de la décision d'un membre de la fratrie sur la décision de l'autre). Les résultats obtenus sur les données françaises de l'enquête Handicap-Santé de 2008 confirment l'importance du rang dans la fratrie pour comprendre les comportements d'aide. En effet, deux logiques de comportements distinctes apparaissent, aussi bien dans les déterminants structurels que dans les interactions. D'une part, si l'aide des enfants est influencée par les caractéristiques du parent quelque soit leur rang, les aînés semblent par ailleurs réagir principalement à la composition de la fratrie, tandis que les cadets adaptent leurs comportements à leurs contraintes personnelles. D'autre part, l'implication de l'autre membre de la fratrie augmente l'utilité d'être aidant pour les aînés, alors qu'elle la diminue pour les cadets. L'aide des aînés se comprendrait alors comme l'acceptation d'une assignation sociale, tandis que celle des cadets répondrait à une logique d'arbitrage, fondée sur la comparaison des coûts et des avantages associés à l'aide. |
| Keywords: | long-terme care,informal care,social interactions,aide informelle,interactions sociales,personnes âgées dépendantes |
| Date: | 2016–04 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-01316903&r=age |
| By: | Schreiber, Sven; Beblo, Miriam |
| Abstract: | We revisit the alleged retirement consumption puzzle. According to the life-cycle theory, foreseeable income reductions such as those around retirement should not affect consumption. However, we first recall that given higher leisure endowments after retirement, the theory does predict a fall of total market consumption expenditures. In order not to mistake this predicted drop for a puzzle we focus on housing consumption which can be plausibly regarded as complementary to leisure, and we control for the leisure change in our empirical specifications, using micro data for Germany (SOEP), where housing expenditures are observable as rents for the majority (60%), as well as dwelling relocations. We still find significant negative impacts of the retirement status on housing consumption, which is hard to reconcile with the life-cycle theory. For retirees we also find significant effects of the income reduction at retirement on housing. However, the effects are small in quantitative terms, given the lock-in nature of past housing decisions. |
| Keywords: | consumption smoothing,retirement-consumption puzzle,SOEP |
| JEL: | D91 E21 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fubsbe:20168&r=age |
| By: | Fedotenkov, Igor |
| Abstract: | This paper studies whether a pension reform, namely a switch from a pay-as-you-go (PAYG) to a more-funded scheme should be announced. We show that such an announcement increases savings, leading to a decline in interest rates. Smaller returns to savings lead to higher losses for the first transitional generation, which suffers from the reform the most. On the other hand, higher savings by the first transitional generation lead to faster capital accumulation, which benefits younger generations. We argue that if a government cares about the agents with the most to lose, it may more beneficial not to announce such a reform. |
| Keywords: | Pension reform, announcement, savings, interest rate |
| JEL: | E13 E21 H55 |
| Date: | 2016–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:71336&r=age |
| By: | Perihan Hazel Kaya (Selcuk University); Mustafa Göktuğ Kaya (Ministry of Finance of Turkey) |
| Abstract: | In recent years domestic savings rate has shown a marked decline in Turkey. Such falls are effective in the growth of savings-investment gap and so the emergence of large current account deficit. In this context, changes are made in the private pension system in order to increase household savings. The new system aims to increase the savings and sawing owners. Many developing countries, with their reforms in the social security field, put into practice the private pension system in addition to the compulsory public pension system.The purpose of this is to deal the development of the private pension system in Turkey and its contribution to savings. In this direct, firstly, the development of the private pension system in the world is being addressed and later mentioned about development in Turkey. Finally, information is given about impact to savings. |
| Keywords: | Private Pension System, Savings, Banking, Turkey |
| JEL: | E21 D10 |
| URL: | http://d.repec.org/n?u=RePEc:sek:iacpro:3606078&r=age |
| By: | Roller, Christiane; Stroka-Wetsch, Magdalena A.; Linder, Roland |
| Abstract: | Due to the demographic change and the concomitant ageing of society, the labor force will reduce in Germany in the following decades. Simultaneously, the demand for informal care will increase as a result of the ageing society. Informal care is assumed being the least expensive form of care and is the most common form of care in Germany. However, the literature conveys the impression that informal care is not easily compatible with a range of situations in life. This is especially confirmed by findings of negative health effects of informal caregiving. Based on these findings, it could be suspected that there have to be large effects on employment, as individuals with health restrictions are supposed to work less. Indeed, findings on effects of informal care provision on employment indicate a rather small or even an insignificant effect. We think that health problems become manifest in some form or another. Thus, the effects of informal care provision on labor supply are possibly larger than it has been assumed so far. To verify our hypothesis, we examine the effects of informal caregiving on a health related labormarket outcome in the form of work disability days using administrative data of Germany's largest sickness fund, the Techniker Krankenkasse with more than 5 million observations. In order to identify the effects of informal care on work disability days, linear regression models are estimated in which is controlled for timeinvariant heterogeneity. The results illustrate a significant positive relationship between informal caregiving and the number of work disability days. |
| Abstract: | Während als eindeutig belegt gilt, dass die informelle Pflege durch Angehörige die in Deutschland am weitesten verbreitete Pflegeform darstellt, besteht in der Literatur kein Konsens über die Auswirkungen der Erbringung derartiger Pflegeleistungen auf die Arbeitsmarktpartizipation und Gesundheit. Die Ergebnisse bereits vorhandener Studien weisen zwar überwiegend auf negative Effekte der Pflege auf die Gesundheit hin, dies spiegelt sich jedoch nicht in einer entsprechenden Verringerung des Arbeitsangebotes wider. Ziel dieser Studie ist es daher zu untersuchen, inwiefern es eine indirekte Verringerung des Arbeitsangebotes gibt, die aus der gesundheitlichen Belastung durch die Pflege resultiert und sich womöglich auf Arbeitsunfähigkeitstage auswirkt. Hierzu werden Routinedaten Deutschlands größter Krankenkasse (der Techniker Krankenkasse) mit über 10 Millionen Versicherten ausgewertet. Die Ergebnisse zeigen große Effekte der informellen Pflegeerbringung auf die Arbeitsunfähigkeitstage, was darauf hinweist, dass die Arbeitsmarkteffekte ohne die Betrachtung der Arbeitsunfähigkeitstage in der bisher existierenden Literatur unterschätzt wurden. |
| Keywords: | informal care,work disability days,demographic change,ageing society,administrative data,fixed-effects |
| JEL: | I10 J10 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:rwirep:616&r=age |
| By: | O'Hare, Colin; Li, Youwei |
| Abstract: | The area of mortality modelling has received significant attention over the last 25 years owing to the need to quantify and forecast improving mortality rates. This need is driven primarily by the concern of governments, insurance and actuarial professionals and individuals to be able to fund their old age. In particular, to quantify the costs of increasing longevity we need suitable model of mortality rates that capture the dynamics of the data and forecast them with sufficient accuracy to make them useful. In this paper we test several of the leading time series models by considering the fitting quality and in particular, testing the residuals of those models for normality properties. In a wide ranging study considering 30 countries we find that almost exclusively the residuals do not demonstrate normality. Further, in Hurst tests of the residuals we find evidence that structure remains that is not captured by the models. |
| Keywords: | Mortality; stochastic models; residuals; Hurst exponents |
| JEL: | C51 C52 C53 G22 G23 J11 |
| Date: | 2016–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:71394&r=age |
| By: | Tadashi Morita (Faculty of Economics, Kindai University,); Yasuhiro Sato (Faculty of Economics, University of Tokyo); Kazuhiro Yamamoto (Graduate School of Economics, Osaka University) |
| Abstract: | We examine possible impacts of demographics on outcomes of capital tax compe- tition in political economy. For this purpose, we develop an overlapping generations model wherein public good provision financed by capital tax is determined by majority voting. When a population is growing, younger people represent the majority, whereas when a population is decreasing, older people represent the majority. We show that the race to the bottom is likely to emerge in the population growing economy whereas the race to the top might emerge in the population decreasing economy. |
| Keywords: | tax competition, majority voter, fiscal externality, political externality |
| JEL: | H20 J11 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:osk:wpaper:1613&r=age |
| By: | Tadashi Morita (Faculty of Economics, Kindai University); Yasuhiro Sato (Faculty of Economics, The University of Tokyo); Kazuhiro Yamamoto (Graduate School of Economics, Osaka University) |
| Abstract: | We examine possible impacts of demographics on outcomes of capital tax competition in political economy. For this purpose, we develop an overlapping generations model wherein public good provision financed by capital tax is determined by majority voting. When a population is growing, younger people represent the majority, whereas when a population is decreasing, older people represent the majority. We show that the race to the bottom is likely to emerge in the population growing economy whereas the race to the top might emerge in the population decreasing economy. |
| URL: | http://d.repec.org/n?u=RePEc:tky:fseres:2016cf1012&r=age |
| By: | Capéau, Bart; Decoster, André |
| Abstract: | This paper exploits the distinction between preference and opportunity factors in a Random Utility and Random Opportunity (RURO) model of job choice (Aaberge, Dagsvik and Strøm, 1995, and Aaberge, Colombino and Strøm, 1999). We estimate the model on Belgian data (SILC 2007). To investigate to what extent lower labour market participation of elderly is due to changing preferences (executing a job might become less enjoyable with age) or to differences in opportunities (elderly getting less, or less attractive job offers), we use the estimated model to simulate two counterfactuals. In the first, we remove partly the age heterogeneity in opportunities, in the second we remove age heterogeneity in preferences. A comparison of labour market behaviour in these two counterfactuals with the baseline shows that opportunities which decline with age are at least as an important factor in explaining low participation rates for the elderly, as is increasing preference for leisure. The effect of opportunities seems to work primarily through the extensive margin, whereas the effect of preferences is more outspoken in the intensive than in the extensive margin. |
| Date: | 2016–05–19 |
| URL: | http://d.repec.org/n?u=RePEc:ese:emodwp:em4-16&r=age |