|
on Economics of Ageing |
| By: | Cipriani, Giam Pietro (University of Verona); Fioroni, Tamara (University of Verona) |
| Abstract: | This paper studies retirement and child support policies in a small, open, overlapping-generations economy with PAYG social security and endogenous retirement and fertility decisions. It demonstrates that neither fertility nor retirement choices necessarily coincide with socially optimal allocation, because agents do not take into account the externalities of fertility and the elderly labor supply in the economy as a whole. It shows that governments can realize the first-best allocation by introducing a child allowance scheme and a subsidy to incentivize the labor supply of older workers. As an alternative to subsidizing the elderly labor supply, we show that the first-best allocation can also be achieved by controlling the retirement age. Finally, the model is simulated in order to study whether the policies devoted to realizing the social optimum in a market economy could be a Pareto improvement. |
| Keywords: | PAYG pensions, social security, endogenous fertility, endogenous retirement |
| JEL: | D10 H2 H55 J13 J18 J26 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14018&r=all |
| By: | Partha Sen |
| Abstract: | Pay-as-you-go (PAYG) social security schemes in the OECD countries are facing solvency problems, as people are living longer and birth rates have declined. Postponing the full retirement age (FRA), when retirees are entitled to full pension, has been proposed as a solution. This effectively lowers the payroll tax rate since pension is paid only in the post-FRA period. In a two-period two-sector overlapping generations model, I show that this shift lowers savings (because a part of the expected old age income is consumed in the first period), as employment increases. In the transition to the new steady state, capital is decumulated and the wage rate falls. Contrast this with a reduction of the payroll tax rate where the initial old suffer reduced consumption, but the young have higher post-tax income and this spurs capital accumulation. |
| Keywords: | overlapping generations, social security reform, postponing retirement |
| JEL: | H55 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8751&r=all |
| By: | Tatiyaporn SIRISAKDAKUL (Faculty of Liberal Arts and Management Science, Kasetsart University, Thailand Author-2-Name: Butsakorn KHORNJAMNONG Author-2-Workplace-Name: Faculty of Liberal Arts and Management Science, Kasetsart University, Thailand Author-3-Name: Author-3-Workplace-Name: Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:) |
| Abstract: | Objective - This study aimed to investigate the level of understanding of financial knowledge and the relationship between financial literacy and retirement planning of working-age people. Methodology – The participants of the study were residents of Sakon Nakhon, Nakhon Phanom and Mukdahan, Thailand. The questionnaire is the research tool for collecting data with 1,200 adults, aged between 25-60. This study will use a descriptive statistical analysis to describe frequency, percentage, mean and mode. Ordinary Least Squares (OLS) method is widely used to describe the relationship between financial literacy and retirement planning. Findings – The result show that the level of education has a positive relationship with financial literacy. Most of middle lower income people have a moderate to low level of the basic financial literacy and are not involved in retirement planning. The respondents of women in Sakon Nakhon, Nakhon Phanom and Mukdahan have more understanding of retirement planning than men; this result is different to the previous research undertaken by Lusardi and Mitchell (2011), Bucher-Koenen and Lusardi (2011) Grohmann et al. (2016). Novelty – This paper will study the level of understanding of financial knowledge and the relationship between financial literacy and retirement planning of working-age people. Most of the previous research concentrated on people who live in the big city; there was. little focus on people living in the countryside, especially in the Northeastern part of Thailand. Not too many papers have focused on the working-age people, who in due course will contribute to Thailand becoming an Aging Society. It could help to the government, labor union, Bureau of Financial Inclusion Policy and Development and related departments to know the level of financial knowledge and retirement planning. So, they could provide guidance of financial literacy to community. Type of Paper - Empirical |
| Keywords: | Financial literacy; Retirement planning; Working-age people |
| JEL: | E21 G02 I22 J26 |
| Date: | 2020–12–31 |
| URL: | http://d.repec.org/n?u=RePEc:gtr:gatrjs:jfbr177&r=all |
| By: | Priscilla Fialho; Jens Høj |
| Abstract: | Population ageing will lead to a smaller and older workforce. Looking forward, this means that growth will increasingly depend on ensuring the best use of Slovenian workers. This implies keeping older and experience workers longer in employment and better support difficult-to-employ low-skilled job-seekers. In addition, better labour allocation will enable workers to realise their productivity and wage potential. This requires a greater role for social partners in securing individual wages that better reflect efforts. |
| Keywords: | Labour Allocation, Labour Participation, Population Ageing |
| JEL: | J08 J14 J21 J31 J60 |
| Date: | 2020–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1648-en&r=all |
| By: | John Bailey Jones; Yue Li |
| Abstract: | Using a heterogeneous-agent, life-cycle model of Social Security claiming, labor supply and saving, we consider the implications of lifespan inequality for Social Security reform. Quantitative experiments show that welfare is maximized when baseline benefits are independent of lifetime earnings, the payroll tax cap is kept roughly unchanged, and claiming adjustments are reduced. Eliminating the earnings test and the income taxation of Social Security benefits provides additional gains. The Social Security system that would maximize welfare in a "2050 demographics" scenario, characterized by longer lifespans and an increased education-mortality gradient, is similar to the one that would maximize welfare today. |
| Keywords: | Social security; Mortality; Labor Supply; Welfare |
| JEL: | E21 H24 H55 I38 J11 |
| Date: | 2020–07–17 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedrwp:88806&r=all |
| By: | Hippolyte d'Albis (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Ikpidi Badji (EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique); Najat El Mekkaoui (Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres, LEDa - Laboratoire d'Economie de Dauphine - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres - CNRS - Centre National de la Recherche Scientifique); Julien Navaux (uOttawa - University of Ottawa [Ottawa]) |
| Abstract: | We use the National Transfer Accounts methodology to calculate private asset income by age for the years 1979–2011. We analyze age profiles using three indicators of intergenerational equity. Monetary asset income shows no evidence of generational breaks to the benefit of the baby‐boom generation. On the contrary, baby‐boomers suffered from the high interest rates that they paid to become homeowners. Imputed rents show an obvious breakdown of intergenerational equity when we use an inter‐age and intergenerational indicator. This indicator compares the per capita asset income at a given age with the average asset income of people aged 18‐85. It gives the relative situation of one age group compared to its contemporaries and it also gives the relative situation of one generation when we compare birth cohorts over time. We find that the cohort born in 1950 benefited from a better position than their successors. Moreover, the cohorts born before the war and during the war appear to be even more favored than the baby‐boomers. The cohorts born in 1930 and in 1940 have a better situation than the previous generations and a better position than the following generations. |
| Keywords: | National Transfer Accounts,Private Asset Income,Intergenerational Equity |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-03019470&r=all |
| By: | Mäcken, Jana; Präg, Patrick; Hess, Moritz; Ellwardt, Lea |
| Abstract: | This article examines country differences in the association between education and voluntary or involuntary labor market exit and whether these country differences map onto institutional characteristics of the countries. Work exit is defined as involuntary based on the reasons of exit. Four different types of institutional factors, push and pull, aiming for an earlier work exit and need and maintain factors to retain older workers in employment are considered. Using data from 15 European countries from the longitudinal Survey of Health, Aging and Retirement in Europe (SHARE), discrete- time event history models with a categorical outcome are estimated for each country separately. In a second step, we add macro-level indicators and conduct meta-analyses to analyze country differences. Results show that in almost all countries a social gradient in involuntary work exit exists but not in voluntary exit. Lower-educated workers are more likely to involuntarily exit the labor market. Institutional factors, especially those supporting older workers’ retention in employment, are associated with a smaller social gradient in work exit. Our findings suggest that investments in active labor market expenditures, especially in lifelong learning and rehabilitation for lower educated workers, may help to reduce the social gradient in involuntary work exit. |
| Date: | 2020–12–08 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:gdtcp&r=all |
| By: | Kumo, Kazuhiro |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:hit:hitcei:2020-6&r=all |
| By: | Benjamin Lerch (Department of Economics, Università della Svizzera italiana, Switzerland) |
| Abstract: | I analyze the impact of one of the leading automation technologies of the last decades – industrial robots – on the declining labor force participation in the US. Exploiting exogenous variation in the adoption of robots across local labor markets and over time, I find that, on average, one additional robot drives two workers out of the labor force. The massive increase in robot adoption between the mid-1990s and 2014 explains about 15 percent of the decline in labor force participation in these years. I next investigate the channels through which automation affects nonparticipation and find that robot adoption leads to rising university enrollment rates among the young, early retirement of older workers and a considerable fraction of middle-aged workers enrolling in disability insurance. |
| Keywords: | industrial robots, labor force participation, education, disability, early retirement |
| JEL: | I12 I26 J21 J26 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:lug:wpidep:2003&r=all |
| By: | Jessamyn Schaller; Chase S. Eck |
| Abstract: | We use an event-study approach to examine changes in intergenerational financial transfers and informal care within families following wealth loss, job exit, widowhood, and health shocks. We find sharp reductions in parental giving to adult children following negative shocks to parents' wealth and earned income, particularly in low-wealth households. Parental giving also decreases with some health shocks and increases following spousal death. Meanwhile, children of low-wealth households increase financial transfers to their parents following adverse shocks and children in both high- and low-wealth households increase their provision of informal care to parents following a wide range of adverse shocks. |
| JEL: | D10 D14 D15 D64 I10 J14 J26 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28295&r=all |
| By: | Tanaka, Yasuhito |
| Abstract: | We examine positive or negative real balance effect (or so-called Pigou effect) by falls in the nominal wage rate and the prices of the goods in situations where there is involuntary unemployment using a three-generations overlapping generations model with childhood period and pay-as-you go pension system for the older generation consumers. We will show that if the net savings of the younger generation consumers are larger than their debts due to consumption in their childhood period, there exists positive real balance effect and the employment increases by a fall in the nominal wage rate; on the other hand, if the net savings of the younger generation consumers are smaller than their debts, there exists negative real balance effect and the employment decreases by a fall in the nominal wage rate. |
| Keywords: | Positive or negative real balance effects, involuntary unemployment, three-generations overlapping generations model. |
| JEL: | E12 E24 |
| Date: | 2020–11–24 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:104333&r=all |
| By: | International Monetary Fund |
| Abstract: | This Selected Issues paper focuses on cross-country differences in savings rates in advanced European countries. It explores a range of demographic, fiscal and financial factors that could explain why household savings are low in Portugal compared to its peers. Portugal’s household saving rate is lower than those of the average European country. This difference can be explained by Portugal’s lower disposable income, lower financial net wealth, higher old-age dependency ratio, higher government spending on pensions and on social protection benefits, and higher homeownership ratio, as suggested by a comparison against another 14 European countries conducted with the aid of panel regressions. Other factors that could underlie Portugal’s low household saving are the country’s lower education levels, fertility rate, and private pension coverage. Many of these factors are not amenable to simple or direct policy interventions, although some policy initiatives aimed at higher level objectives, such as promoting economic growth, could have positive side effects on household saving. More specific policy options to boost household saving include measures to promote private occupational and personal plans, including some changes in taxation, and developing incentives to work past age 65. |
| Keywords: | Pensions;Pension spending;Aging;Income;Personal income;ISCR,CR,Portugal,employee,tax treatment,rate |
| Date: | 2019–07–12 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfscr:2019/222&r=all |
| By: | Gimenez-Nadal, J. Ignacio (University of Zaragoza); Molina, José Alberto (University of Zaragoza); Velilla, Jorge (University of La Rioja) |
| Abstract: | This paper explores the mobility patterns of elder workers in the United States, with a focus on mobility to and from work (e.g., commuting) across metropolitan areas and metropolitan population sizes. Using detailed time diaries from the American Time Use Survey for the years 2003-2018, estimates reveal a positive correlation between the time spent commuting and residing in metropolitan areas, which is also driven by longer commutes in more populated metropolitan areas. Furthermore, elder workers in metropolitan areas of more than 2.5 million inhabitants use more public transports in their commuting trips than similar workers in less-populated or non-metropolitan areas. The analysis presented here may allow policy makers to identify which elder workers may be more affected by the negative consequences of commuting, and also which groups of elder workers have more limitations in their commuting behaviors. |
| Keywords: | commuting time, elder workers, metropolitan areas, population size, American Time Use Survey |
| JEL: | R40 J14 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13949&r=all |
| By: | Grund, Christian (RWTH Aachen University); Rubin, Maike (RWTH Aachen University) |
| Abstract: | We investigate whether job autonomy is associated with employees' sickness absence. We can make use of the representative German Study of Mental Health at Work data. In line with our theoretical considerations, we do find evidence for an inverse relation between employees' job autonomy and days of sickness absence. This relation is only weakly mediated by job satisfaction and particularly relevant for more senior employees. |
| Keywords: | job autonomy, sickness absence, age, job satisfaction |
| JEL: | J81 M12 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13945&r=all |
| By: | David Adeabah (University of Ghana, Legon, Ghana); Simplice A. Asongu (Yaoundé, Cameroon); Charles Andoh (University of Ghana, Legon, Ghana) |
| Abstract: | This study examines the impact of remittances and information and communication technology (ICT) on pension at the country level. Our empirical evidence, based on data from 96 countries, indicate a significant non-linearity between remittances, ICT and pension income coverage. First, we find a convex relation between remittances and pension income coverage, indicating that increases in remittance, initially decreases pension income coverage, but as remittance increases beyond a certain point, so too does pension income coverage. This inflection point, where the effect of remittances turns from negative to positive, is estimated to be around 3.09% of GDP. Second, we document a concave relationship between ICT (i.e. mobile subscription and internet penetration) and pension income coverage. An increase in ICT results in increased pension income coverage. However, when ICT reaches a certain point, any further increase is associated with lower pension income coverage. The estimated optimal point is found to be around 140.14 subscriptions (per 100 people) for mobile phone and 27.93 (per 100 people) for internet penetration, respectively. Other implications are discussed. |
| Keywords: | Pension income coverage; Remittances; Mobile subscription; Internet penetration; ICT |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:abh:wpaper:20/059&r=all |
| By: | Patrizio Vanella; Ugofilippo Basellini; Berit Lange |
| Abstract: | The current outbreak of COVID-19 has called renewed attention to the need for sound statistical analysis for monitoring mortality patterns and trends over time. Excess mortality has been suggested as the most appropriate indicator to measure the overall burden of the pandemic on mortality. As such, excess mortality has received considerable interest during the first months of the COVID-19 pandemic. Previous approaches to estimate excess mortality are somewhat limited, as they do not include sufficiently long-term trends, correlations among different demographic and geographic groups, and the autocorrelations in the mortality time series. This might lead to biased estimates of excess mortality, as random mortality fluctuations may be misinterpreted as excess mortality. We present a blend of classical epidemiological approaches to estimating excess mortality during extraordinary events with an established demographic approach in mortality forecasting, namely a Lee-Carter type model, which covers the named limitations and draws a more realistic picture of the excess mortality. We illustrate our approach using weekly age- and sex-specific mortality data for 19 countries and the current COVID-19 pandemic as a case study. Our proposed model provides a general framework that can be applied to future pandemics as well as to monitor excess mortality from specific causes of deaths. |
| Keywords: | COVID-19 Pandemic, Excess Mortality Assessment, Mortality Forecasting, Principal Component Analysis, International Mortality Trends, Time Series Analysis, Monte Carlo Simulation, MORTALITE / MORTALITY, EPIDEMIE / EPIDEMICS, ANALYSE DES DONNEES / DATA ANALYSIS |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:idg:wpaper:axbhmxrs-o0viyh9z07m&r=all |
| By: | Laudicella, Mauro (University of Southern Denmark, DaCHE - Danish Centre for Health Economics); Di Donni, Paolo (University of Palermo, Economics Department & University of Southern Denmark, DaCHE); Rose Olsen, Kim (University of Southern Denmark, DaCHE - Danish Centre for Health Economics); Gyrd-Hansen, Dorte (University of Southern Denmark, DaCHE - Danish Centre for Health Economics) |
| Abstract: | This study measures the increment of health care expenditure (HCE) that can be attributed to technological progress and change in medical practice by using a residual approach and microdata. We examine repeated cross-sections of individuals experiencing an initial health shock at different point in time over a ten-year window and capture the impact of unobservable technology and medical practice to which they are exposed after allowing for differences in health and socioeconomic characteristics. We decompose the residual increment in the part that is due to the effect of delaying time to death, i.e. individuals surviving longer after a health shock and thus contributing longer to the demand of care, and the part that is due to increasing intensity of resource use, i.e. the basket of services becoming more expensive to allow for the cost of innovation. We use data from the Danish National Health System that offers universal coverage and is free of charge at the point of access. We find that technological progress and change in medical practice can explain about 60% of the increment of HCE, in line with macroeconomic studies that traditionally investigate this subject. |
| Keywords: | Health care expenditure; Time-to-death; Ageing; Morbidity; Technological impact |
| JEL: | H51 I18 O33 |
| Date: | 2020–12–15 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sduhec:2020_004&r=all |