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on Economics of Ageing |
| By: | Lucas van der Velde (Group for Research in Applied Economics (GRAPE); Warsaw School Economics) |
| Abstract: | Population ageing poses new challenges to the sustainability of the pension system and possibly to economic growth in advanced economies. In such context, calls are made to increase participation of workers close to their retirement age. Ageing occurs in a period where technological progress has changed the patterns of labor demand, away from physically demanding tasks (opportunity) and into more cognitive-interpersonal type of tasks (challenge). To understand the net effect, we analyze the relation between automation and labor supply of older workers. We explore whether exposure to technological change, measured by the task content of jobs, was connected to labor supply of older workers in Germany and Great Britain. Using panel data, we show that the adjustment in the number of hours of workers in occupations exposed to automation was small, and only negative for a subset of workers. The exposure to automation is related to somehow earlier retirement, but the size of the relation is small. |
| Keywords: | task content, routinization, retirement, labor supply, automation |
| JEL: | J24 J26 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:fme:wpaper:23&r=age |
| By: | Ben J. Heijdra; Yang Jiang; Jochen O. Mierau |
| Abstract: | We study the impact of a fully-funded social security system in an economy with heterogeneous consumers. The unobservability of individual health conditions leads to adverse selection in the private annuity market. Introducing social security—which is immune to adverse selection—affects capital accumulation and individual welfare depending on its size and on the pension benefit rule that is adopted. If this rule incorporates some implicit or explicit redistribution from healthy to unhealthy individuals then the latter types are better off as a result of the pension system. In the absence of redistribution the public pension system makes everybody worse off in the long run. Though attractive to distant generations, privatization of social security is not generally Pareto improving to all generations. |
| Keywords: | social security, annuity market, adverse selection, overlapping generations, redistribution |
| JEL: | D91 E10 H55 J10 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6767&r=age |
| By: | Christophe Daniel (Granem - Groupe de Recherche ANgevin en Economie et Management - UA - Université d'Angers - AGROCAMPUS OUEST - Institut National de l'Horticulture et du Paysage); Anne Lavigne (LEO - Laboratoire d'économie d'Orleans - UO - Université d'Orléans - CNRS - Centre National de la Recherche Scientifique); Stéphane Mottet (CRIEF - Centre de Recherche sur l'Intégration Economique et Financière - Université de Poitiers); Jesus Herell Nze Obame (Granem - Groupe de Recherche ANgevin en Economie et Management - UA - Université d'Angers - AGROCAMPUS OUEST - Institut National de l'Horticulture et du Paysage); Bruno Séjourné (Granem - Groupe de Recherche ANgevin en Economie et Management - UA - Université d'Angers - AGROCAMPUS OUEST - Institut National de l'Horticulture et du Paysage); Christian Tagne (LEO - Laboratoire d'économie d'Orleans - UO - Université d'Orléans - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | Abstract: Using French administrative data, we assess the impact of the 1993 pension reform on private sector retirees' pension wealth. This pension reform by its design has created incentives to postpone retirement by increasing the contributory record to qualify for a full pension and through pension haircuts for individuals not fulfilling the conditions to be eligible to a full pension (either not reaching the legal retirement age or not having the required contributory period). We show that the reform has globally reduced retirees' pension wealth, especially for retires having retired after 2004 or having postponed their retirement beyond the legal age of retirement. The reform has also had a significant impact on the distribution of pension wealth among retirees. |
| Abstract: | A l'aide des données de l'Echantillon Interrégimes des Retraités de 2008, nous quantifions les effets de la réforme des retraites de 1993 sur l'équivalent patrimonial des droits à retraite (EPDR) des retraités du régime général. Cet indicateur qui représente la pension probable cumulée à percevoir pendant la retraite permet d'estimer les effets liés au report de l'âge de liquidation et à la décote sur la pension induits par l'allongement de la durée d'assurance requise pour une retraite à taux plein. Nous montrons que cette mesure a globalement réduit l'EPDR des retraités, de manière plus importante pour les retraités ayant liquidé leurs droits après 2004 ou ayant reporté leur départ après 60 ans. Elle a également affecté la distribution de l'EPDR parmi les retraités. |
| Keywords: | quantile regressions, contributory period,pension wealth, pension reform, retirement age,droits à retraite,réforme,durée d'assurance,retraités,régressions |
| Date: | 2017–10–14 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01616826&r=age |
| By: | Krzysztof Makarski (Narodowy Bank Polski; Warsaw School Economics; Group for Research in Applied Economics (GRAPE)); Joanna Tyrowicz (Group for Research in Applied Economics (GRAPE); University of Warsaw; Institut für Arbeitsrecht und Arbeitsbeziehungen in der Europäischen Union (IAAEU); Institute of Labor Economics (IZA)); Marcin Bielecki (University of Warsaw; Narodowy Bank Polski) |
| Abstract: | We analyze the consumption and wealth inequality in an OLG model with obligatory pension systems. Our framework features within cohort heterogeneity of endowments (individual productivities) and heterogeneity of preferences (preference for leisure and time preference). We allow for population aging and gradual productivity slowdown. We show four main results. First, longevity increases substantially aggregate consumption inequality and wealth inequality, regardless of the pension system features. Second, the effect of a pension system reform from a defined benefit to a defined contribution works to reinforce the consumption inequality and reduce the wealth inequality. Third, minimum pension benefits are able to counteract a part of that increase in inequality, at a fiscal cost. Fourth the minimum pension benefit guarantee addresses mostly the inequality which stems from differentiated endowments and not that which stems from heterogeneous preferences. |
| Keywords: | majority voting, pension system reform, welfare |
| JEL: | E32 E44 E58 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:fme:wpaper:21&r=age |
| By: | Zuzana Brokesova (University of Economics in Bratislava); Andrej Cupak (National Bank of Slovakia); Gueorgui Kolev (Middlesex University London) |
| Abstract: | We utilise recent Household Finance and Consumption Survey microdata to report first causal effects of financial literacy on voluntary private pension schemes participation for Slovakia. Savings for retirement in the supplementary pension schemes are positively associated with financial literacy after controlling for a set of relevant socio-economic variables. One additional correctly answered financial literacy question leads to a 6 percentage points increase in the probability of having a voluntary pension savings plan in our ordinary least squares estimates. The causal impact of financial literacy increases to 16 percentage points when we address potential endogeneity problem by novel to the literature instrumental variables. Interestingly, we find less significant effects of financial literacy on the probability of individuals having employer-supported private pension savings plans. Our findings inform policy and suggest how policymakers can promote the voluntary retirement savings behaviour of individuals in Slovakia and in other Central and Eastern European countries in times of decreasing benefits of state pensions. |
| Keywords: | Financial literacy, Retirement savings, Survey data, Endogeneity, Instrumental variables, Slovakia |
| JEL: | D14 D91 I2 |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:svk:wpaper:1051&r=age |
| By: | Nicolas Afflatet |
| Abstract: | Population ageing is one of the major long-term challenges industrialized countries face. Forecasts predict that public debt is going to rise sharply for most countries due to population ageing. However, until now there has been little research on how population ageing already affects public debt. Based on a panel data analysis for 18 European countries it is shown that there is only little empirical evidence for an impact until 2015. This does certainly not mean that it will not have an effect on public debt in the future. Governments are well-advised to benefit from the breathing space the still moderate total dependency ratio offers to adapt their social security systems. |
| Keywords: | Population ageing, public debt, social security systems, demographic dividend |
| JEL: | E62 H63 J11 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:str:wpaper:1615&r=age |
| By: | DongWoo Ko (Hankuk University of Foreign Studies, South Korea) |
| Abstract: | Previous studies have shown that Medicare beneficiaries tend not to switch their prescription drug plans even though they can largely save drug costs by plan switching. To explore why this so called “plan stickiness†happens, the present study focused on the concept of social exclusion, which is one of the most important characteristics of the elderly. This study compared the impact of two types of social exclusion on an association between psychological cost and plan switchingpassive social exclusion and active social exclusion. These two types are known to differently influence consumers’ motivation and decision-making process. The 2007 Prescription Drug Study supplement to the Health and Retirement Study data were used for analysis. We investigated the individual- level willingness to switch across multiple levels using a Hierarchical Linear Model. The findings suggest that passive social exclusion is associated with uncertainty cost. Study findings will help policymakers better understand the elderly’s plan decision- making process and promote their informed plan decisions. |
| Keywords: | Medicare, Beneficiaries Non-Switching Behavior, Psychological Cost, Hierarchical Linear Model. |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:smo:opaper:23&r=age |
| By: | Antoine Goujard |
| Abstract: | France’s health-care system offers high-quality care. Average health outcomes are good, public satisfaction with the health-care system is high, and average household out-of-pocket expenditures are low. As in other OECD countries, technology is expanding possibilities for life extension and quality, and spending is rising steadily, while an ageing population requires substantially more and different services. The main challenges are to promote prevention and cost-efficient behaviour by care providers, tackle the high spending on pharmaceuticals, strengthen the role of health insurers as purchasing agents and secure cost containment. Good-quality information and appropriate financing schemes would ensure stronger efficiency incentives. Disparities of coverage across social groups and health services suggest paying greater attention to co-ordination between statutory and complementary insurance provision. Ongoing reforms to improve prevention and co-ordination among care providers are steps in the right direction. However, progress in the development of capitation-based payment schemes, which can reduce the incentives to increase the number of medical acts and encourage health professionals to spend more time with their patients, and performance-based payment schemes in primary care need to be stepped up to respond to the increasing prevalence of chronic diseases and curb supplier-induced demand and social disparities in access to care. |
| Keywords: | ageing, fee-for-services, France, generics, health care system, health disparities, health insurance, health policy, health practitioners, healthcare coordination, hospital, medical demography, pharmaceutical expenditures, prevention, primary healthcare |
| JEL: | I11 I12 I13 I15 I18 |
| Date: | 2018–01–10 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1455-en&r=age |
| By: | Gustafsson, Björn Anders (University of Gothenburg); Mac Innes, Hanna (University of Gothenburg); Österberg, Torun (University of Gothenburg) |
| Abstract: | This paper examines immigrant poverty at an older age in Sweden with an emphasis on late-in-life immigrants. We analyse tax data for the entire Swedish-born and non-Swedish-born population. The poverty status of a household is assessed using two criteria. First, the disposable income of the household in which the person lived in 2007 must be below 60 per cent of the median equivalent in-come in Sweden as a whole. Second, to be classified as 'twice poor' a household net assets must be below SEK 10,000. The results indicate that three out of four Swedish-born older persons were not classified as poor by either of the criteria, and only one per cent by both criteria. In contrast, among older persons born in low-income countries almost three out of four were classified as poor according to one of the criteria and not fewer than one in three according to both. Results of estimating logistic models indicate that the risk of being considered poor according to both criteria is strongly positively related to one's age at immigration. Our results indicate that it is crucial that migrants, particularly those who arrive after age 40, be better integrated into the Swedish labour market. To alleviate pov-erty among those migrants who are already of older age, increased transfers are probably the only possible alternative. |
| Keywords: | older people, poverty, immigrants, Sweden |
| JEL: | I32 J14 J15 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11144&r=age |
| By: | Frimmel, Wolfgang (Johannes Kepler University Linz and Christian Doppler Laboratory Aging, Health and the Labor Market); Halla, Martin (Johannes Kepler University Linz, Christian Doppler Laboratory Aging, Health and the Labor Market, IZA, Institute for the Study of Labor, Bonn and G¨OG, Austrian Public Health Institute, Vienna); Schmidpeter, Bernhard (University of Essex, Institute for Social and Economic Research); Winter-Ebmer, Rudolf (Johannes Kepler University Linz, Christian Doppler Laboratory Aging, Health and the Labor Market, IZA, Institute for the Study of Labor, Bonn, IHS, Institut for Advanced Studies, Vienna and CEPR, Centre for Economic Policy Research, London) |
| Abstract: | The labor supply effects of becoming a grandmother are not well established in the empirical literature. We estimate the effect of becoming a grandmother on the labor supply decision of older workers. Under the assumption that grandmothers cannot predict the exact date of conception of their grandchild, we identify the effect of the first grandchild on employment (extensive margin). Our Timing-of-Events approach shows that having a first grandchild increases the probability of leaving prematurely the labor market. This effect is stronger when informal childcare is more valuable to the mother. To estimate the effect of an additional grandchild (intensive margin), we assume that the incidence of a twin birth among the third generation is not correlated with unobserved determinants of the grandmother’s labor supply (first generation). Our respective instrumental variable estimations show a significant effect of further grandchildren. Our results highlight the important influence of the extended family on the decisions of older workers and point to mediating effects of different institutional settings. |
| Keywords: | Grandchildren, female labor supply, timing of events, instrumental variables |
| JEL: | J13 J14 J22 |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:ihs:ihsesp:336&r=age |