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on Economics of Ageing |
| By: | Juan Manuel Pérez-Salamero González (Department of Financial Economics and Actuarial Science, University of Valencia.); Marta Regúlez-Castillo (Department of Applied Economics III. University of the Basque Country (UPV/EHU).); Carlos Vidal-Meliá (Department of Financial Economics and Actuarial Science, University of Valencia.) |
| Abstract: | The aim of this paper is to examine differences in life expectancy (LE) between selfemployed (SE) and paid employee (PE) workers when they become retirement pensioners, looking at levels of pension income using administrative data from Spanish social security records. We draw on the Continuous Sample of Working Lives (CSWL) to quantify changes in total life expectancy at ages 65 (LE65) and 75 (LE75) among retired men over the longest possible period covered by this data source: 2005–2018. These changes are broken down by pension regime and pension income level for three periods. Contrary to what has been observed in countries such as Italy, Finland and Japan, LE65 in Spain is slightly higher for the self-employed than for the paid employees when retirement pensioners. For 2005-2010, a gap in life expectancy of 0.23 years between SE and PE retirement pensioners is observed. This gap widens to 0.55 years for 2014–2018. A similar trend can be seen if pension income groups are considered. For 2005-2010, the gap in LE65 between pensioners in the lowest and the highest income groups is 1.20 years. This gap widens over time and reaches 1.51 years for 2014–2018. Although these differences are relatively small, they are statistically significant. According to our research the implications for policy on social security are evident: differences in life expectancy by socioeconomic status and pension regime should be taken into account for a variety of issues involving social security schemes, e.g. to establish the age of eligibility for retirement pensions and early access to benefits, to compute the annuity factors used to determine initial retirement benefits, and to value the liabilities taken on for retirement pensioners. |
| Keywords: | Continuous Sample of Working Lives; Life expectancy; Paid employees; Retirement; Self-employed; Spain. |
| JEL: | C81 H55 I14 J26 |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:ucm:doicae:2104&r=all |
| By: | Juan Manuel Pérez-Salamero González (Department of Financial Economics and Actuarial Science, University of Valencia.); Marta Regúlez Castillo (Department of Quantitative Methods. University of the Basque Country (UPV/EHU).); Carlos Vidal-Meliá (Department of Financial Economics and Actuarial Science, University of Valencia, Instituto Complutense de Análisis Económico, Complutense (ICAE), University of Madrid, Spain (research affiliate) and Centre of Excellence in Population Ageing Research (CEPAR), UNSW, Sydney, Australia.) |
| Abstract: | We draw on the Continuous Sample of Working Lives (CSWL) to investigate the differences in socioeconomic mortality among retired men aged 65 and above over the longest possible period covered by this data source: 2005–2018. This paper deals with the case of Spain, since very little evidence concerning retirement pensioners is available for this country. The only indicator of socioeconomic status we use is the amount of the initial pension of the retired population. For 2005-2010 we find a gap in life expectancy of 1.49 years between pensioners in the highest and lowest income groups. This gap widens over time and reaches 2.58 years for the period 2015–2018. The increase in life expectancy inequality cannot be attributed to the pension system reforms carried out over the period 2011-2013, given that the system has become more redistributive and there has been a clear increase in real terms in the amounts of minimum pensions over recent years. The causes might be traced back to the decrease in public spending on health over the period 2009-2018 and the increased spending on private health, which would presumably be of more benefit to those retirees with bigger pensions. |
| Keywords: | Inequalities; Life Expectancy; Life Tables; Mortality; Socioeconomic Factors. |
| JEL: | C81 H55 I14 J26 |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:ucm:doicae:2102&r=all |
| By: | Esteban García-Miralles (University of Copenhagen); Jonathan M. Leganza (University of California, San Diego) |
| Abstract: | How does the provision of public pension benefits impact private savings? We answer this question in the context of a reform in Denmark that altered old-age benefit payouts through a discontinuous increase in pension eligibility ages contingent on birthdate. Using detailed administrative data and a regression discontinuity design, we identify the causal effects of the policy, leveraging our setting to study essentially the entire financial portfolio. We document responses over two distinct time horizons. First, we show a lack of responses after the reform was announced but before it was implemented, inconsistent with the notion that future differences in pension eligibility impact savings. Second, we show large savings responses after implementation, when delayed benefit eligibility induces individuals to extend employment. Specifically, we find increased contributions to both employer-sponsored and personal retirement accounts, whereas we find no evidence of adjustments to other savings vehicles, such as bank or stock market accounts. Additional analyses point to inertia as a leading explanatory channel. The increased savings in personal retirement plans is entirely driven by those who made consistent contributions in the past. Moreover, the increased savings in employer-sponsored plans is largely explained by continuing to contribute at employer default rates, highlighting a role for firm policies in mediating responses to social security reform. |
| Keywords: | social security, private savings, pension reform |
| JEL: | H55 D14 J26 |
| Date: | 2021–03–04 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kucebi:2106&r=all |
| By: | Naomitsu Yashiro; Tomi Kyyrä; Hyunjeong Hwang; Juha Tuomala |
| Abstract: | Among various barriers to increasing employment of older workers, this paper focuses on two notable ones that are relevant for the future of work. First, older workers engaged in codifiable, routine tasks are particularly prone to the risk of being displaced by computers and robots. Second, several countries have in place various labour market institutions that encourage early retirement, such as exceptional entitlements or looser criteria for unemployment and disability benefits applied to older individuals. This paper presents evidence that these two factors reinforce each other to push older workers out of employment. It is found that older workers who are more exposed to digital technologies are more likely to leave employment, and that this effect is significantly magnified when they are eligible to an extension of unemployment benefits until they start drawing old age pension. Furthermore, a simple simulation based on the empirical findings illustrates that a reform that tightens the eligibility for the benefit extension would increase mostly the employment of older workers that are more exposed to digital technologies. |
| Keywords: | early retirement, technological change, unemployment benefits |
| JEL: | H55 J26 J65 O33 |
| Date: | 2021–03–05 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1659-en&r=all |
| By: | Wilfried Guets (Univ Lyon, Université Lumière Lyon 2, GATE UMR 5824, F-69130 Ecully, France) |
| Abstract: | The role of informal carers in long-term care sheds light on the struggle related to population ageing and the increasing incidence of chronic disease. However, despite the increasing number of informal carers, most of them experienced the burden of caregiving. Since various policies have been implemented across countries to support informal carers, their attitude toward support services should be addressed. This research consisted of investigating how formal home care affected the utilisation of support services by informal carers. Data used stemmed from the 2015 Survey Capacité Aide et Ressources des Seniors (“CARE ménage”) collected in France; and the National Health and Aging Trends Survey (NHATS) with the National Survey of Caregiving (NSOC) in the United States of America (U.S.). Andersen’s health behavioural model of support services utilisation provided a conceptual framework for investigating predisposing , enabling, and need variables associated with informal carers services use. We used a probit model for econometrics modelling. We also checked for the endogeneity of formal care. A sample of N = 4,866 in France and N = 1,060 in the U.S. informal carers and care recipients’ dyads were used in the study. In France, the care recipients’ formal care utilisation does not influence the carer support service use. Comparatively, in the United States, formal care significantly increases the respite services utilisation by informal carers. This study provides important implications for Long-Term Care (TLC) dedicated to health policy, for an optimal trade-off between informal and formal care use, bearing in mind health system specificities. First, countries may spend more funds in innovative support programs in access to care, because some carers may have difficulties in accessing and using support services. Secondly, to provide and foster information campaigns to raise awareness concerning the utilisation of various existing health services, to improve social welfare. |
| Keywords: | Formal home care, Informal care, Support service utilisation, Econometrics |
| JEL: | I12 C25 J14 I19 O52 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:2105&r=all |
| By: | Lin, Zhuoer; Chen, Xi |
| Abstract: | We examine the long-term relationship between childhood circumstances and cognitive aging. In particular, we differentiate the level of cognitive deficit from the rate of cognitive decline. Applying a linear mixed-effect model to three waves of China Health and Retirement Longitudinal Surveys (CHARLS 2011, 2013, 2015) and matching cognitive outcomes to CHARLS Life History Survey (2014), we find that key domains of childhood circumstances, including family socioeconomic status (SES), neighborhood cohesion, friendship and health conditions, are significantly associated with both the level of cognitive deficit and the rate of decline. In contrast, childhood neighborhood safety only affects the level of cognitive deficit. Childhood relationship with mother only affects the rate of cognitive decline. The effects of adverse childhood circumstances are generally larger on level of cognitive deficit than on rate of cognitive decline. Moreover, education plays a more important role in mediating the relationships compared to other later-life factors. These findings suggest that exposure to disadvantaged childhood circumstances can exacerbate cognitive deficit as well as cognitive decline over time, which may be partially ameliorated by educational attainment. |
| Keywords: | Childhood circumstances,life course factors,cognitive aging,education |
| JEL: | I14 I24 J13 J14 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:794&r=all |
| By: | Vandenberghe, Vincent |
| Abstract: | This paper contributes to the literature on old employment barriers by exploring empirically the relative importance of mental v.s. physical health in determining work. It combines regression and variance decomposition analyses to quantify the respective role of mental v.s. physical health. The data used are from SHARE and inform in great detail on the health but also work status (i.e. employment and hours) of individuals aged 50+, interviewed between 2004 and 2017 in 21 European countries. The main result of the paper is that of the rather limited role of mental health | in comparison to physical health | in accounting for older individuals' work. The paper also shows that health (physical or mental) is much better at predicting old people's propensity to be in employment than the number of hours they work. Finally, the paper reveals that, in comparison to women, men's work is more driven by their health status. |
| Keywords: | Ageing,Work,Mental v.s. Physical Health,Regressions and Variance Decomposition |
| JEL: | J22 I10 J26 J14 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:796&r=all |
| By: | Anirban Mitra |
| Abstract: | How does economic inequality affect public spending on healthcare in democracies? Does this depend upon the demographic composition of the electorate? We build a multidimensional model of political decision-making with endogenous political parties to analyse such questions. Voters in our model differ in terms of income and age. The tax rate, the allocation of the revenue between income redistribution and two forms of public spending - healthcare and capital investment - are determined through political competition. All agents value healthcare equally but the young like capital investment more than the old do. We find that when the young are a majority, public healthcare spending tends to be lower on average than when the young are a minority. Moreover, when the old are a majority the equilibrium public healthcare provision depends critically upon the extent of income inequality. We also discuss implications regarding the on-going demographic transition (population ageing) and the Covid-19 pandemic. |
| Keywords: | Demography; Economic Inequality; Healthcare; Voting |
| JEL: | D72 H42 I14 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:2105&r=all |
| By: | Raquel Fonseca; Hugo Morin; Ana I. Moro-Egido |
| Abstract: | This paper investigates the bi-directional causal relationship between retirement and stress. We use PSID data for the period 2007-2015. Using a simultaneous equations approach, we find that a rise in stress increases the probability to retire by roughly 15.4 percentage points, while retirement decreases stress by 34.5 percentage points. We find the same results when we disaggregate by individuals’ characteristics, but the former effect is stronger for males, for people working in typical blue-collar jobs, and for people whose wealth is below the mean; while the latter is stronger for males, for white-collar workers, for people whose wealth is above the mean, and for white individuals. We show that official retirement ages are a strong instrument for actual retirement age, and that lagged physical activity levels are a non-linear instrument for perceived stress. We also confirm that objective measures of mental health are a strong instrument for perceived stress. |
| Keywords: | stress, retirement, physical activity, simultaneous equation models. |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:rsi:creeic:2103&r=all |
| By: | Yunus Aksoy (Birkbeck, University of London); Henrique S. Basso (Banco de España); Carolyn St Aubyn (Birkbeck, University of London) |
| Abstract: | We document systematic and signicant time variation in US lifecycle nondurable consumption profiles. Consumption profiles have consistently become flatter: intergenerational differences in consumption across age groups have decreased over time. Pooling data across different periods to identify lifecycle proles and failing to account for unobserved heterogeneity masks relevant time variations and may articially generate hump-shaped consumption age profiles. The main driver behind lifecycle consumption variations are lifecycle income changes, which display similar flattening. Employing a lifecycle model we show changes in income are sufficient to match the movements in consumption. |
| Keywords: | age profile of consumption, age profile of income, cohort effects, consumption heterogeneity, time variation, pooling |
| JEL: | E21 J11 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:2111&r=all |