|
on Economics of Ageing |
| By: | Joseph F. Quinn; Kevin E. Cahill; Michael D. Giandrea |
| Abstract: | Do the retirement patterns of public-sector workers differ from those in the private sector? Most private-sector workers today face a do-it-yourself retirement income landscape characterized by an exposure to market forces through defined-contribution pension plans and private saving, and the risk of financial insecurity later in life. Public-sector workers, in contrast, are typically covered by defined-benefit pension plans that both encourage retirement at relatively young ages and offer financial security at older ages. As a result, the consequences of private- and public-sector workers’ retirement decisions could differ in important ways. For workers generally, and for private-sector workers in particular, a focus among researchers and policymakers has been the importance of continued work later in life for improving financial security at older ages. Such concerns might be of less consequence for public-sector workers due to the prevalence of defined-benefit pensions. Public-sector workers’ departures from the labor force might also differ from those in the private sector, all else equal, because of the age-specific incentives within their defined-benefit plans. Despite these important differences, the private-public distinction has received relatively little attention in the retirement literature. Our paper examines how private- and public-sector workers transition from career employment to complete labor force withdrawal, with a focus on the role of bridge employment, phased retirement, and re-entry. We identify the prevalence and determinants of each pathway to retirement using longitudinal data on four cohorts of private- and public-sector career older workers from the Health and Retirement Study (HRS). Our findings suggest that the prevalence of work after leaving career employment among public-sector workers resembles that of private-sector workers, although with a higher prevalence of part-time bridge employment, a result that has important implications for public policy as the pace of societal aging accelerates. |
| JEL: | H55 J14 J26 J32 |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25003&r=age |
| By: | Börsch-Supan, Axel; Härtl, Klaus; Leite, Duarte; Ludwig, Alexander |
| Abstract: | We propose a unified framework to measure the effects of different reforms of the pension system on retirement ages and macroeconomic indicators in the face of demographic change. A rich overlapping generations (OLG) model is built and endogenous retirement decisions are explicitly modeled within a public pension system. Heterogeneity with respect to consumption preferences, wage profiles, and survival rates is embedded in the model. Besides the expected direct effects of these reforms on the behavior of households, we observe that feedback effects do occur. Results suggest that individual retirement decisions are strongly influenced by numerous incentives produced by the pension system and macroeconomic variables, such as the statutory eligibility age, adjustment rates, the presence of a replacement rate, and interest rates. Those decisions, in turn, have several impacts on the macro-economy which can create feedback cycles working through equilibrium effects on interest rates and wages. Taken together, these reform scenarios have strong implications for the sustainability of pension systems. Because of the rich nature of our unified model framework, we are able to rank the reform proposals according to several individual and macroeconomic measures, thereby providing important support for policy recommendations on pension systems. |
| Keywords: | population aging,pension reform,social security,life-cycle behavior,labor supply,retirement age,welfare |
| JEL: | C68 D91 E17 H55 J11 J26 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:safewp:221&r=age |
| By: | Zheng, Xiaodong; Fang, Xiangming; Barger, Brian |
| Keywords: | Agricultural and Food Policy, Agribusiness, Consumer/Household Economics |
| Date: | 2017–07–03 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea17:258401&r=age |
| By: | Angelika Kallakmaa-Kapsta |
| Abstract: | Ten years after housing boom in Estonia the housing market has been restored. Comparing to 1997 the average notarized purchase-sale price has raised 2.3 times by 2016. It is again the question about the price level. One problem in housing market is concern about affordability issues, but there is also another aspect, that has not been paid enough attention. The proportion of older people is growing. According to the Statistics Estonia share of persons at pension age (65 years and older) has been grown from 12 % of population in early 90s to 19 % in 2017. People live increasingly longer and it is to be expected that the number and share of older people increases. The availability of comfort characteristics in the dwellings inhabited by households has improved significantly. During the lifetime the living space per person generally increases, but people may lose some of their functional abilities which may create a need for a different type of dwelling.This article seeks answers how to define the impact of an ageing population to the housing market in Estonia. |
| Keywords: | ageing; Estonia; Housing Market; Housing Policy |
| JEL: | R3 |
| Date: | 2018–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2018_219&r=age |
| By: | Lin, B.; Lin, Z.; Zhang, Y.Y.; Liu, W. |
| Abstract: | This paper evaluates the effect of China’s New Rural Pension Scheme (NRPS) on labor supply of the rural elderly in the forms of both formal labor supply informal labor supply, using data from China Health and Retirement Longitudinal Study (CHARLS). We explore the regional differences of the NRPS effect on labor supply between the West and non-West regions of China. Our analysis shows that western rural China has a more severe problem of “ceaseless toil” compared to the rest of the country. We find that NRPS improves the “ceaseless toil” situation of the Chinese rural elderly but the results show a very different pattern between western China and other part of the country. |
| Keywords: | Community/Rural/Urban Development, Labor and Human Capital |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iaae18:275997&r=age |
| By: | Aldén, Lina (Linnaeus University Centre for Discrimination and Integration Studies); Hammarstedt, Mats (Linnaeus University Centre for Discrimination and Integration Studies) |
| Abstract: | This paper compares life satisfaction among the elderly (61 years of age or older) who are self-employed, wage-employed or out of the labour force in Sweden with the help of a unique survey. Sweden is interesting since the share of elderly, just as in other countries, has increased during the last decade. Encouraging the elderly to remain in the labour force is now high on the political agenda. We find that people who are self-employed report higher life satisfaction than people who are wage-employed or out of the labour force. General health is a strong determinant of life satisfaction but the differences among the groups remain when we control for health related variables. Further, the self-employed report higher job satisfaction than the wage-employed, and find their work less mentally straining or stressful. Even though our results are driven by different types of selection, we conclude that they underline the need for a flexible working life. Stimulating self-employment among older people may be an effective way to improve their life satisfaction, to increase Sweden’s labour supply and to keep older people in the labour force. |
| Keywords: | Self-employment; Ageing; Life satisfaction: Job satisfaction |
| JEL: | J14 J26 J28 |
| Date: | 2018–09–11 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1229&r=age |
| By: | Nico Keilman; Dinh Q. Pham; Astri Syse (Statistics Norway) |
| Abstract: | Historically, official Norwegian mortality projections computed by Statistics Norway have consistently under-predicted life expectancy. The projected age distribution of deaths may be used to check if the official mortality projections are plausible. The aim of the paper is to verify whether the projections predict a continuation of the ongoing compression in mortality and of the steady upward shift in the ages at which people die. We use official period data on observed (1900-2015) and projected (2016- 2060) sex- and age-specific mortality to estimate the age distribution of life table deaths. We analyse trends in life expectancy at birth, modal and median ages at death, and standard deviation of the age distribution at ages > 30. The historical shifts towards longer longevity are projected to continue into the future. The projections suggest a steady increase in the modal and the median age at death for men and women towards values between 90 and 94 years in 2060. At present these ages are in the range 83-90 years. Simultaneously, deaths become more concentrated around the mean, as the standard deviation of the age distribution is projected to fall continuously. Statistics Norway’s projection methodology is capable of tracking ongoing processes of mortality shifts towards higher ages and a compression of mortality around the modal and mean ages. Mortality projections could potentially benefit from including assessments of the age distribution of deaths. |
| Keywords: | age distribution; life expectancy; median age; modal age; mortality compression; mortality delay; Norway; population projection |
| JEL: | C53 I10 |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:ssb:dispap:884&r=age |
| By: | Abeliansky, Ana Lucia; Strulik, Holger |
| Abstract: | There exists a steady trend at which later born cohorts, at the same age, are healthier than earlier born cohorts. We show this trend by computing a health deficit index for a panel of 14 European Countries and six waves of the Survey of Health, Aging, and Retirement in Europe (SHARE). We find that for each year of later birth, health deficits decline by on average 1.4 - 1.5 percent with insignificant differences between men and women, between countries, and over time. We argue that this trend approximates the rate of medical progress, broadly defined. The steady progress implies substantial delays of human aging. For example, the level of health deficits experienced at age 65 by individuals born 1920 is predicted to be experienced at age 85 by individuals born 1945. The potential health gains are not fully appropriated by individuals of low socio-economic status. Their health deficits decline at about the same rate but from a higher level, which means that we find long-run persistence of health inequality. |
| Keywords: | health,aging,health deficit index,medical progress,health inequality |
| JEL: | I10 I14 I15 I24 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cegedp:355&r=age |
| By: | Ordoñez, Guillermo; Piguillem, Facundo |
| Abstract: | The U.S. economy has recently experienced a large increase in life expectancy and in shadow banking activities. We argue that these two phenomena are intimately related. Agents rely on financial intermediaries to insure consumption during their uncertain life spans after retirement. When they expect to live longer, they rely more heavily on financial intermediaries that are riskier but offer better insurance terms - including shadow banks. We calibrate the model to replicate the level of financial intermediation in 1980, introduce the observed change in life expectancy and show that the demographic transition is critical in accounting for the boom in both shadow banking and credit that preceded the recent U.S. financial crisis. We compare the U.S. experience with a counterfactual without shadow banks and show that they may have contributed around 0.6GDP to output, four times larger than the estimated costs of the crisis. |
| Keywords: | Ageing Population; financial crisis; shadow banking |
| JEL: | E21 E44 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13144&r=age |
| By: | Bloom, David E. (Harvard University); McKenna, Matthew J. (Data for Decisions LCC); Prettner, Klaus (University of Hohenheim) |
| Abstract: | Globally, an estimated 734 million jobs will be required between 2010 and 2030 to accommodate recent and ongoing demographic shifts, account for plausible changes in labour force participation rates, and achieve target unemployment rates of at or below 4 percent for adults and at or below 8 percent for youth. The facts that i) most new jobs will be required in countries where "decent" jobs are less prevalent and ii) workers in many occupations are increasingly subject to risks of automation further compound the challenge of job creation, which is already quite sizable in historical perspective. Failure to create the jobs that are needed through 2030 would put currently operative social security systems under pressure and undermine efforts to guarantee the national social protection floors enshrined in the Sustainable Development Goals (SDGs). |
| Keywords: | demography, unemployment, job creation, automation, digitalization |
| JEL: | J11 J20 J24 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11739&r=age |
| By: | Seok, Jun Ho; Reed, Michael R.; Moon, Han-Pil |
| Keywords: | Community/Rural/Urban Development, International Development, Productivity Analysis |
| Date: | 2017–07–03 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea17:258573&r=age |
| By: | Niklas Engbom (Princeton University) |
| Abstract: | I assess the impact of an aging labor force on business dynamism, labor market fluidity and economic growth. The analysis embeds endogenous growth through creative destruction in an equilibrium job ladder model, highlighting feedback between the extent of mismatch in the labor market and incentives to innovate. I calibrate the model to aggregate reallocation rates and show that the theory replicates life cycle firm and worker dynamics in the data. The model implies that labor force aging over the last 30 years in the US explains 40-50 percent of the decline in job and worker reallocation and has reduced annual economic growth by 0.3 percentage points. Using cross-state variation and instrumenting for the incidence of aging using lagged age shares, I find additional empirical support for the prediction of large effects of aging on dynamism and growth. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:1009&r=age |
| By: | Serkan Arslanalp; Jaewoo Lee; Umang Rawat |
| Abstract: | Demographic developments have been regarded as one important cause of the long-term movement in global interest rates. This paper provides empirical evidence of the relationship between demographics and interest rates over a wide sample of advanced and emerging market economies. It also finds that capital account openness limits the direct sensitivity of a country’s interest rates to its own demographics. The results suggest that future demographic developments will continue to apply downward pressure on the interest rates in Asia which foresees a rapid aging. |
| Date: | 2018–07–27 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:18/172&r=age |