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on Economics of Ageing |
| By: | Olga Fuentes; Jeanne Lafortune; Julio Riutort; José Tessada; Félix Villatoro |
| Abstract: | We randomly offer to workers in Chile personalized versus generalized information about their pension savings and forecasted pension income. Personalized information increased the probability and amounts of voluntary contributions after one year without crowding-out other forms of savings. Personalization appears to be very important: individuals who overestimated their pension at the time of the intervention saved more. Thus, a person’s inability to understand how the pension system affects them may partially explain low pension savings. Despite the significant response to the intervention, its temporary nature and size suggest that information should be combined with other elements to increase its efficiency. |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ioe:doctra:483&r=age |
| By: | Messacar, Derek |
| Abstract: | This paper assesses the extent to which education affects how Canadians save and accumulate wealth for retirement. The paper makes three contributions. First, a descriptive analysis is presented of differences in savings and home values across individuals based on their levels of educational attainment. To this end, new datasets that link survey respondents from the 1991 and 2006 censuses of Canada to their administrative tax records are used. These data provide a unique opportunity to jointly observe education, savings, home values, and a plethora of other factors of relevance. Second, the causal effect of high school completion on savings rates in tax-preferred accounts is estimated, exploiting compulsory schooling reforms in the identification. Third, building on a recent study by Messacar (2015), education is also found to affect how individuals re-optimize their savings rates in response to an automatic change in pension wealth accumulation. The implications of this study?s findings for the ?nudge paradigm? in behavioural economics are discussed. |
| Keywords: | Education, training and learning, Income, pensions, spending and wealth, Outcomes of education, Pension plans and funds and other retirement income programs |
| Date: | 2017–03–27 |
| URL: | http://d.repec.org/n?u=RePEc:stc:stcp3e:2017391e&r=age |
| By: | Motegi, Hiroyuki; Nishimura, Yoshinori; Oikawa, Masato |
| Abstract: | This study examines the effects of retirement on health investment behaviors. We conduct a large-scale international comparison of the change in health investment behaviors after retirement among 9 developed countries, using harmonized datasets. We find that the changes in some of health investment behaviors (e.g., Exercise) are improved in most of the countries. With respect to exercise, the change in the opportunity cost to exercise after retirement is a possible reason to explain this improvement. |
| Keywords: | retirement, health investment behaviors, global aging data |
| JEL: | I12 J26 |
| Date: | 2017–03–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:77674&r=age |
| By: | Groneck, Max; Ludwig, Alexander; Zimper, Alexander |
| Abstract: | On average young people "undersave" whereas old people "oversave" with respect to the rational expectations model of life-cycle consumption and savings. According to numerous studies on subjective survival beliefs, young people also "underestimate" whereas old people "overestimate" their objective survival chances on average. We take a structural behavioral economics approach to jointly address both empirical phenomena by embedding subjective survival beliefs that are consistent with these biases into a rank-dependent utility (RDU) model over life-cycle consumption. The resulting consumption behavior is dynamically inconsistent. Considering both naive and sophisticated RDU agents we show that within this framework underestimation of young age and overestimation of old age survival probabilities may (but need not) give rise to the joint occurrence of undersaving and oversaving. In contrast to this RDU model, the familiar quasi-hyperbolic discounting (QHD), which is nested as a special case, cannot generate oversaving. |
| Keywords: | saving puzzles,subjective survival beliefs,behavioral economics,prospect theory,neo-additive probability weighting,dynamic inconsistency,sophisticated versus naive behavior,quasi-hyperbolic discounting |
| JEL: | D91 D83 E21 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:safewp:169&r=age |
| By: | Piotr Lewandowski; Roma Keister; Wojciech Hardy; Szymon Gorka |
| Abstract: | This paper analyses the age dimension of changes in the task composition of jobs in 12 European countries between 1998 and 2014. We use the approach proposed by Autor et al. (2003) and Acemoglu & Autor (2011), and combine O*NET occupation content data with EU-LFS individual data to construct five task content measures: non-routine cognitive analytical, non-routine cognitive interpersonal, routine cognitive, routine manual, and non-routine manual physical. We find that the shift away from routine work and toward non-routine work occurred much faster among workers born between 1970 and 1989 than among workers born between 1950 and 1969. We find that in the majority of countries, the ageing of the workforce occurred more quickly in occupations that were initially more routine-intensive, as the share of young workers in these occupations was declining. We estimate logit models that show that individuals in these occupations were increasingly likely to be unemployed, especially if they were between the ages of 15 and 34. |
| Keywords: | task content of jobs, routinisation, ageing, occupational change, O*NET |
| JEL: | J21 J23 J24 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:ibt:wpaper:wp012017&r=age |
| By: | Patrick Blagrave; Marika Santoro |
| Abstract: | Gains in labor force participation rates in Chile have slowed in recent years. We examine their determinants using a cohort-model analysis. Allowing for both age- and cohort-specific effects in the context of a seemingly unrelated regression equations (SURE) approach, we find that age factors play an important role in determining participation decisions, especially for males. For females, we find that strong positive time trends dominate the downward pressure from demographics, although those trends have recently dissipated. In addition, we find that both cohort effects and the business cycle shape participation decisions. Using our cohort-based analysis, we construct projections of participation rates, which suggest population aging will put downward pressure on labor inputs, and thus potential output, in coming years. Further increases in female labor force participation—supported by policies— could more than offset the downward pressure from demographics. |
| Date: | 2017–03–13 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:17/54&r=age |
| By: | Willem Devriendt; Freddy Heylen (-) |
| Abstract: | In the absence of behavioural adjustments, demographic change may cut off about 0.4%- point on average from the annual per capita growth rate in the next 25 years. The behavioural responses of households and firms to declining fertility and rising life expectancy may significantly change this outcome, but the sign and the size of this change are unclear. In this paper we construct and parameterize a large-scale OLG model for a small open economy to quantify (the net effect of) these behavioural adjustments. Important endogenous variables in the model are hours worked and (un)employment, investment in human and physical capital, per capita growth and inequality. Individuals differ not only by age, but also by innate ability. We calibrate the model to Belgium and find that it replicates key data since about 1960 remarkably well. Simulating the model, we observe significant (positive) behavioural adjustments by households and firms, but these do not reverse the negative arithmetical effect of projected future demographic change on per capita growth. Many of the adjustments have already taken place in previous decades. Furthermore, ongoing adjustments do not affect future domestic output due to capital outflow in a small open economy. To counter (very) poor per capita growth in the next two decades, policy changes will be necessary. |
| Keywords: | demographic change, population ageing, economic growth, overlapping generations |
| JEL: | C68 D91 E17 J11 O40 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:17/931&r=age |