|
on Economics of Ageing |
| By: | Richard Foltyn; Jonna Olsson |
| Abstract: | Using biennial data from the Health and Retirement Study, we estimate age-dependent health dynamics and survival probabilities at annual frequency conditional on race, sex, and health. The health gradient in life expectancy is steep and persists after controlling for socioeconomic status. Moreover, even conditional on health and socioeconomic status, the racial gap in life expectancy remains large. Simulations show that this gap affects savings rates but does not play a major role in explaining the racial wealth gap. However, differences in mortality imply that black individuals on average can expect to receive 15% less in Social Security benefits in present value terms. |
| Keywords: | Life expectancy, health dynamics, racial life expectancy gap |
| JEL: | C23 E21 I14 J14 |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:gla:glaewp:2021_17&r= |
| By: | Barr, Nicholas |
| Abstract: | This paper explores the nature of reciprocity between workers and pensioners, starting from the observation that what pensioners consume has mostly to be produced by younger workers, and therefore reciprocity in some form is inherent. The opening section argues that a worker can try to arrange consumption in retirement by (a) storing current production or (b) building claims on future production. However, storing current production (the squirrels model) does not work well, so that the main vehicle is building claims on future production. There are two approaches to doing so – through promises (which lie at the core of Pay-As-You-Go (PAYG) plans), or by accumulating financial assets which can be exchanged for goods and services (the basis of funded plans). The second part of the paper establishes that a central element in assessing pension arrangements is the extent to which investment is in productive assets. The third part considers the durability of different pension regimes. The paper’s central conclusions are (a) that reciprocity is inherent in pension plans, (b) that the specifics of pension design are in many ways secondary, and (c) that what really matters are economic growth (increasing what is available to share between workers and pensioners) and good government (which will manage PAYG pensions responsibly and/or sustain the economic stability and regulatory capacity that underpin funded pensions). |
| Keywords: | pensions; funding; pay-as-you-go; reciprocity; social security; saving; investment |
| JEL: | D63 E21 E22 E24 J14 J18 |
| Date: | 2021–09–06 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:111927&r= |
| By: | Laura Juárez (El Colegio de México); Yunuen Nicte Rodríguez Piña (Consejo Nacional de Evaluación de la Política de Desarrollo Social) |
| Abstract: | In this paper, we estimate the impact of a non-contributory pension, in operation at the federal level between 2007 and 2012, on the subjective wellbeing of older adults. Our results suggest that, on average, this pension had a positive, and statistically significant, effect on the subjective wellbeing of older women, but not on that of older men. However, a heterogeneous impact analysis reveals that there are positive impacts of this pension for men who speak and indigenous language, and that the positive impacts are more pronounced for older women without primary education. |
| Keywords: | pensiones no contributivas, bienestar subjetivo, adultos mayores |
| JEL: | D04 I31 J14 |
| Date: | 2020–02 |
| URL: | http://d.repec.org/n?u=RePEc:emx:ceedoc:2020-03&r= |
| By: | De Donder, Philippe; Achou, Bertrand; Glenzer, Franca; Lee, Minjoon; Leroux, Marie-Louise |
| Abstract: | COVID-19 outbreaks at nursing homes during the recent pandemic, which received ample media coverage, may have lasting negative impacts on individuals’ perceptions regarding ursing homes. We argue that this could have sizable and persistent implications for savings and long-term care policies. We first develop a theoretical model predicting that higher nurs- ing home aversion should induce higher savings and stronger support for policies subsidizing home care. We further document, based on a survey on Canadians in their 50s and 60s, that higher nursing home aversion is widespread: 72% of respondents are less inclined to enter a nursing home because of the pandemic. Consistent with our model, we find that the latter are much more likely to have higher intended savings for older age because of the pandemic. We also find that they are more likely to strongly support home care subsidies. |
| Keywords: | Pandemic Risk; Nursing Home; Long-Term Care; Savings; Public Policy |
| Date: | 2021–09–08 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:125934&r= |
| By: | Plamen Nikolov; Steve Yeh |
| Abstract: | Cognitive abilities are fundamental for decision-making, and understanding the causes of human capital depreciation in old age is especially important in an aging society. Using a longitudinal labor survey that collects direct proxy measures of cognitive skills, we study the effect of educational attainment on cognitive performance in late adulthood in South Africa. We find robust evidence that an increase in a year of schooling improves memory performance and general cognition. We also find evidence of heterogeneous effects of educational attainment on cognitive performance. We explore the mechanisms through which education can affect cognitive performance. We show that a more supportive social environment, improved health habits, and reduced stress levels likely play a critical role in mediating the beneficial effects of educational attainment on cognition among the elderly. |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2109.02177&r= |
| By: | Jain, Neha (Indian Institute of Foreign Trade); Goli, Srinivas |
| Abstract: | India is on the edge of a demographic revolution with a rapidly rising working-age population. For the first time in this study, we investigate the role of the rising working-age population on per capita small savings in post offices and banks net of socio-economic characteristics using state-level panel data compiled from multiple sources for the period 2001-2018. Our comprehensive econometric assessment with multiple robustness checks provide three key findings: (1) Per capita private savings is increasing because of India’s growing working-age population, thus the ‘economic life cycle hypothesis’ is supported. (2) The demographic factors contribute around one-fourth of the per capita private savings inequality across Indian states. (3) The demographic window of economic opportunity for India can yield maximum benefits in terms of private savings when accompanied by favourable socio-economic policies on education, health, gender equity, and economic growth. |
| Date: | 2021–09–04 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:n73ab&r= |
| By: | HASHIMOTO Yuki; KOMAE Kazutomo |
| Abstract: | This study examines the negative externalities resulting from limited opportunities for negotiations between government institutions. We show that the externalities caused by subsidized wheelchair-accessible vehicles (SWAV) under policies for elderly care have eroded the demand for taxis regulated by transportation policies in Japan. An increase of 10 percent of SWAV is associated with a roughly 1 percent decrease in the number of passengers and operating revenue for taxis. The increase in SWAV accounts for as much as one third of the drop in taxi usage between 2010 and 2015. Our analysis also finds that taxi drivers' wage elasticity is greater than 1, meaning that wages were reduced more than the decrease in taxi usage. |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:21074&r= |
| By: | Francesco Giuli; Giuseppe Ciccarone (Sapienza University of Rome); Enrico Marchetti (University of Naples Parthenope) |
| Abstract: | We study the effects of COVID-19, and the ensuing lockdown and scal policies, on the welfare of different age-groups within a life-cycle macroeconomic scheme, adapted from Gertler (1999), where the pandemic is represented as a shock to the mortality rate. We obtain two main results. First, we can show that lockdown policies have a negative impact on the dynamics of economic welfare of younger agents relative to that of older agents, thus providing analytical support to the idea that the management of the COVID-19 pandemic through lockdown policies has hit mainlythe young generations. Second, we show that expansionary scal policies aimed at supporting income after the lockdown a¤ect the relative welfare index of age-groups mainly through the repayment scheme of the consequent public debt; the more the repayment scheme entails a postponement of the debt repayment, the more older agents are favored (in relative terms). |
| Keywords: | Covid19, Generational Effects, Containment Policies |
| JEL: | E13 I18 H51 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:rtr:wpaper:0260&r= |
| By: | Fabián Mauricio Rincón Jaimes |
| Abstract: | Este documento evalúa el efecto de las ganancias potenciales asociadas al traslado sobre las decisiones de cambio de régimen pensional en Colombia. El sistema pensional actual genera diferencias en los beneficios pensionales esperados dependiendo del régimen pensional elegido: Régimen de Ahorro Individual con Solidaridad (RAIS) o Régimen Solidario de Prima Media con Prestación Definida (RPM). Se evalúa si estas diferencias son determinantes en la selección del régimen pensional definitivo de los afiliados. Se emplean datos individuales de ahorro pensional y traslados definitivos de afiliados a RAIS en 2015. Para la identificación del efecto, se explotan disposiciones normativas que generan no linealidades en los beneficios potenciales del traslado. Se encuentra que un incremento de 10 puntos porcentuales (p.p.) en la diferencia de la tasa de reemplazo potencial entre el RPM y el RAIS genera un incremento estadísticamente significativo de 1,2 p.p. en la probabilidad de traslado definitivo a RPM, sobre una base promedio de traslados definitivos de 10,4%. Para el diseño de reformas pensionales en Colombia, se sugiere considerar el incremento en el costo fiscal asociado a la existencia de ganancias de traslado hacia el RPM, para generar mecanismos que procuren la sostenibilidad del sistema y la progresividad en la asignación de subsidios. |
| Keywords: | Este documento evalúa el efecto de las ganancias potenciales asociadas al traslado sobre lasdecisiones de cambio de régimen pensional en Colombia. El sistema pensional actual generadiferencias en los beneficios pensionales esperados dependiendo del régimen pensional elegido:Régimen de Ahorro Individual con Solidaridad (RAIS) o Régimen Solidario de Prima Media conPrestación Definida (RPM). Se evalúa si estas diferencias son determinantes en la selección delrégimen pensional definitivo de los afiliados. Se emplean datos individuales de ahorro pensionaly traslados definitivos de afiliados a RAIS en 2015. Para la identificación del efecto, se explotandisposiciones normativas que generan no linealidades en los beneficios potenciales del traslado.Se encuentra que un incremento de 10 puntos porcentuales (p.p.) en la diferencia de la tasa dereemplazo potencial entre el RPM y el RAIS genera un incremento estadísticamente significativode 1, 2 p.p. en la probabilidad de traslado definitivo a RPM, sobre una base promedio de trasladosdefinitivos de 10, 4%. Para el diseño de reformas pensionales en Colombia, se sugiere considerarel incremento en el costo fiscal asociado a la existencia de ganancias de traslado hacia el RPM, para generar mecanismos que procuren la sostenibilidad del sistema y la progresividad en laasignación de subsidios |
| JEL: | H21 H55 J26 |
| Date: | 2021–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:col:000089:019561&r= |