nep-age New Economics Papers
on Economics of Ageing
Issue of 2022‒02‒21
eleven papers chosen by
Claudia Villosio
LABORatorio R. Revelli

  1. Extending Pension Policy in Emerging Asia: An Overlapping-Generations Model Analysis for Indonesia By George Kudrna; John Piggott; Phitawat Poonpolkul
  2. The Unintended Effect of Medicaid Aging Waivers on Informal Caregiving By Liu, Yinan; Zai, Xianhua
  3. The Effect of Medicaid Home and Community-Based Services on Health Outcomes By Liu, Yinan; Zai, Xianhua
  4. Efectos de diversas medidas relacionadas con la edad de jubilación By Jose Enrique Devesa Carpio; Maria del Mar Devesa Carpio; Inmaculada Domínguez Fabián; Francisco Borja Encinas Goenechea; Robert Meneu Gaya
  5. Inequality in mortality between Black and White Americans by age, place, and cause and in comparison to Europe, 1990 to 2018 By Hannes Schwandt; Janet Currie; Marlies Bär; James Banks; Paola Bertoli; Aline Bütikofer; Sarah Cattan; Beatrice Zong-Ying Chao; Claudia Costa; Libertad González; Veronica Grembi; Kristiina Huttunen; René Karadakic; Lucy Kraftman; Sonya Krutikova; Stefano Lombardi; Peter Redler; Carlos Riumallo-Herl; Ana Rodríguez-González; Kjell Salvanes; Paula Santana; Josselin Thuilliez; Eddy van Doorslaer; Tom van Ourti; Joachim Winter; Bram Wouterse; Amelie Wuppermann
  6. Lockdown Strictness and Mental Health Effects Among Older Populations in Europe By Ariadna García-Prado; Paula González; Yolanda Rebollo-Sanz
  7. The e?ects of social policies on the working careers of Europeans By Agar Brugiavini; Giuseppe De Luca; Thomas MaCurdy; Guglielmo Weber
  8. Differences of Nutrition in the Elderly Population with Type 2 Diabetes in Romania, Russia and Japan By Georgeta Stoica-Marcu
  9. Trading and Investment Performance of Pension Fund Investors: Evidence from an Emerging Market Abstract: By Tolga U. Kuzubas; Burak Saltoglu
  10. How accurate are self-reported diagnoses? Comparing self-reported health events in the English Longitudinal Study of Ageing with administrative hospital records By George Stoye; Ben Zaranko
  11. Investing better in universal social protection applying international social security standards in social protection policy and financing By Bierbaum, Mira.; Schmitt, Valérie.

  1. By: George Kudrna; John Piggott; Phitawat Poonpolkul
    Abstract: This paper examines the economy-wide effects of government policies to extend public pensions in emerging Asia particularly pertinent given the region’s large informal sector and rapid population ageing. We first document stylized facts about Indonesia’s labour force, drawing on the Indonesian Family Life Survey (IFLS). This household survey is then used to calibrate micro behaviours in a stochastic, overlapping-generations (OLG) model with formal and informal labour. The benchmark model is calibrated to the Indonesian economy (2000-2019), fitted to Indonesian demographic, household survey, macroeconomic and fiscal data. The model is applied to simulate pension policy extensions targeted to formal labour (contributory pension extensions to all formal workers with formal retirement age increased from 55 to 65), as well as to informal labour (introduction of non-contributory social pensions to informal 65+). First, abstracting from population ageing, we show that: (i) the first set of pension policy extensions (that have already been legislated and are being implemented in Indonesia) have positive effects on consumption, labour supply and welfare (of formal workers) (due largely to the formal retirement age extension); (ii) the introduction of social pensions targeted to informal workers at older age generates large welfare gains for currently living informal elderly; and (iii) the overall pension reform leads to higher welfare across the employment-skill distribution of households. We then extend the model to account for demographic transition, finding that the overall pension reform makes the contributory pension system more sustainable but the fiscal cost of non-contributory social pensions more than triples to 1:7% of GDP in the long run. As an alternative, we examine application of a means-tested social pension system within the overall pension reform. We show that this counterfactual reduces the fiscal cost (of social pensions) and further increases the welfare for both current and future generations.
    Keywords: Informal Labour; Population Ageing; Social Security; Taxation; Redistribution; Stochastic General Equilibrium
    JEL: E26 J1 J21 J26 H55 H24 C68
    Date: 2022–01
  2. By: Liu, Yinan; Zai, Xianhua
    Abstract: Medicaid aging waivers incentivize older adults who need long-term care to stay at home rather than move into a nursing facility. However, this policy may inadvertently shift care burdens onto informal caregivers. Using data on state-level waiver expenditures from 1998 to 2014 linked with the restricted access Health and Retirement Study (HRS), this paper investigates whether program funding is associated with the probability that an HRS respondent provides informal care to her older parents. Changes to state-level policy funding produce a quasi-experiment, which allows us to use two-way fixed effects models to estimate a causal relationship between the program and informal caregiving. The findings show that a 10 percent increase in aging waiver expenditures increases the overall likelihood that an adult child becomes an informal caregiver to her parents by 0.1 percentage points (0.3 percent). The overall estimate is composed of differential effects on different types of care. The results show that the Medicaid aging waiver funding is positively associated with the likelihood of being an errands caregiver and a non-intensive caregiver who spends fewer hours providing care, but unrelated to the likelihood of providing personal care and intensive care. The findings are mainly driven by the mechanism that aging-at-home is more attractive supported by the aging waivers.
    Keywords: Medicaid Aging Waiver,Long-Term Care,HRS,Informal Care
    JEL: I18 J14 J18
    Date: 2022
  3. By: Liu, Yinan; Zai, Xianhua
    Abstract: The Medicaid Home and Community- Based Services (HCBS) program in the United States subsidizes the long-term care provided at home or in community-based settings for older adults. Little is known about how HCBS affects the well-being of the aging population. Using detailed information about health from the Health and Retirement Study (HRS) linked with state-level HCBS policy expenditures, we show that HCBS indeed helps older people avoid institutionalization and stay at home longer. Furthermore, the program is positively associated with the probability of older individuals reporting better mental health, especially among people with limited resources.
    Keywords: Medicaid HCBS,Long-Term Care,HRS,Health
    Date: 2022
  4. By: Jose Enrique Devesa Carpio (Universitat de València); Maria del Mar Devesa Carpio (Universitat de València); Inmaculada Domínguez Fabián (Universidad de Extremadura); Francisco Borja Encinas Goenechea (Universidad de Extremadura); Robert Meneu Gaya (Universitat de València)
    Abstract: The delay in the effective retirement age is one of the measures that has stood out the most, both by the Toledo Pact (Pacto de Toledo) and by the Ministry responsible for Social Security. This delay can be achieved by encouraging retirement to take place later than ordinary age, as well as penalizing early retirement before ordinary age. By comparison with the previous legislation, the additional coefficients for the delay have been improved, the possibility of changing the pension increase for a single payment has been added, the reduction coefficients have been modified and the formula for calculating the early retirement pension has been changed for high bases contribution. In this work we have calculated the effect that these modifications will generate, emphasizing that the delay of one year in the effective retirement age will only suppose, in the best of cases, a saving, in actuarial present value, of 1.04% of the expenditure in pensions, but if the increase only affects early pensions, as seems more realistic, there would be even greater spending. However, an increase in the legal age has a greater impact, generating a saving of 5.69% in actuarial present value. El retraso de la edad efectiva de jubilación es una de las medidas que más han destacado tanto por parte del Pacto de Toledo como del Ministerio con competencias en Seguridad Social. Este retraso se puede conseguir incentivando que la jubilación se realice en una edad posterior a la ordinaria, como penalizando la anticipación de la jubilación antes de la ordinaria. Respecto a la legislación anterior, se han mejorado los coeficientes adicionales por el retraso, se ha añadido la posibilidad de cambiar el incremento de pensión por un pago único, se han modificado los coeficientes reductores y se ha cambiado la fórmula de cálculo de la pensión anticipada cuando se cotiza por bases altas. En este trabajo hemos calculado el efecto que va a generar estas modificaciones, destacando que el retraso de un año en la edad efectiva solo supondrá, en el mejor de los casos, un ahorro, en valor actual actuarial, del 1,04% del gasto en pensiones, pero si el aumento sólo afectara a las anticipadas, como parece más realista, se produciría incluso un mayor gasto. Sin embargo, un aumento de la edad legal tiene un mayor impacto, generando un ahorro de un 5,69% en Valor actual actuarial.
    Keywords: Sistema de pensiones; Jubilación demorada; Jubilación anticipada; Coeficientes reductores; Coeficientes adicionales Pension system; Delayed retirement; Early retirement; Reducing coefficients; Additional coefficients
    JEL: H55
    Date: 2022–02
  5. By: Hannes Schwandt; Janet Currie; Marlies Bär; James Banks; Paola Bertoli; Aline Bütikofer; Sarah Cattan; Beatrice Zong-Ying Chao; Claudia Costa; Libertad González; Veronica Grembi; Kristiina Huttunen; René Karadakic; Lucy Kraftman; Sonya Krutikova; Stefano Lombardi; Peter Redler; Carlos Riumallo-Herl; Ana Rodríguez-González; Kjell Salvanes; Paula Santana; Josselin Thuilliez (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique); Eddy van Doorslaer; Tom van Ourti; Joachim Winter; Bram Wouterse; Amelie Wuppermann
    Abstract: Although there is a large gap between Black and White American life expectancies, the gap fell 48.9% between 1990 and 2018, mainly due to mortality declines among Black Americans. We examine age-specific mortality trends and racial gaps in life expectancy in high- and low-income US areas and with reference to six European countries. Inequalities in life expectancy are starker in the United States than in Europe. In 1990, White Americans and Europeans in high-income areas had similar overall life expectancy, while life expectancy for White Americans in low-income areas was lower. However, since then, even high-income White Americans have lost ground relative to Europeans. Meanwhile, the gap in life expectancy between Black Americans and Europeans decreased by 8.3%. Black American life expectancy increased more than White American life expectancy in all US areas, but improvements in lower-income areas had the greatest impact on the racial life expectancy gap. The causes that contributed the most to Black Americans' mortality reductions included cancer, homicide, HIV, and causes originating in the fetal or infant period. Life expectancy for both Black and White Americans plateaued or slightly declined after 2012, but this stalling was most evident among Black Americans even prior to the COVID-19 pandemic. If improvements had continued at the 1990 to 2012 rate, the racial gap in life expectancy would have closed by 2036. European life expectancy also stalled after 2014. Still, the comparison with Europe suggests that mortality rates of both Black and White Americans could fall much further across all ages and in both high-income and low-income areas.
    Date: 2021–09–28
  6. By: Ariadna García-Prado (Departamento de Economía, Universidad Pública de Navarra); Paula González (Department of Economics, Universidad Pablo de Olavide); Yolanda Rebollo-Sanz (Department of Economics, Universidad Pablo de Olavide)
    Abstract: This paper investigates whether lockdown policies aggravated mental health problems of older populations (50 and over) in Europe during the first COVID-19 wave. Using data from the Survey of Health, Ageing and Retirement in Europe (SHARE COVID-19 questionnaire) and from the Oxford COVID-19 Government Response Tracker for 17 countries, we estimate the causal effect of lockdown policies on mental health by combining cross-country variability in the strictness of the policies with cross-individual variability in face-to-face contacts prior to the pandemic. We find that lockdown policies worsened insomnia, anxiety, and depression by 5, 7.2 and 5.1 percentage points, respectively. This effect was stronger for women and those aged between 50 and 65. Interestingly, lockdown policies notably damaged the mental health of healthy populations. We close with a discussion of lockdown policies targeted at individuals above 65 and/or with pre-existing conditions.
    Keywords: COVID-19, Mental Health, Lockdown, Confinement, Containment Index, Mobility Restrictions, Senior and Older Europeans, Causality.
    JEL: I18 I31
    Date: 2022
  7. By: Agar Brugiavini (Institute for Fiscal Studies and Ca' Foscari University of Venice); Giuseppe De Luca (Institute for Fiscal Studies); Thomas MaCurdy (Institute for Fiscal Studies and Stanford University); Guglielmo Weber (Institute for Fiscal Studies and University of Padua)
    Abstract: We analyse the pattern of work and other labour market states, such as unemployment and out-of-labour-force, over the life course, by making use of a long retrospective panel of older Europeans. Based on stochastic simulations of a reduced form transition probability model, we document to what extent social policies over the life course a?ect employment trajectories both in the long run and in the short run. We focus on two types of reforms that have taken place in various European countries over the lifetime of the panel participants: increases in compulsory school age and increases in pension eligibility age.
    Date: 2020–06–15
  8. By: Georgeta Stoica-Marcu (Ovidius University from Constanta, Romania)
    Abstract: Romania, Russia and Japan are 3 countries where the differences in nutrition are not very large, but which shock us by the increased number of diabetics in the elderly population over 70 years, countries with a low birth rate and an elderly population in addition to diabetes type II suffers from hypertension, cardiovascular disease, kidney disease, neurological disease and a lot of loneliness. Prevention and monitoring programs are deficient in Romania and Russia, but excel in Japan where the state has more responsibility for the elderly population, in a relatively short time, have led to new treatments and diets, which have come to prolong the life of the elderly diabetic, ignored by certain public health systems in certain countries with the lifestyle and the consequences of this lifestyle.
    Keywords: nutrition, diabetes, Yoshinori Ohsumi, and eating habits
    Date: 2021–06
  9. By: Tolga U. Kuzubas; Burak Saltoglu
    Date: 2021–06
  10. By: George Stoye (Institute for Fiscal Studies and Institute for Fiscal Studies); Ben Zaranko (Institute for Fiscal Studies and Institute for Fiscal Studies)
    Abstract: This paper uses linked survey responses and administrative hospital records to examine the accuracy of self-reported medical diagnoses. The English Longitudinal Study of Ageing (ELSA) collects self-reported information on the incidence of heart attacks, strokes and cancer in the past two years. We compare these reports with administrative hospital records to examine whether respondents are recorded as having an inpatient admission with these diagnoses during this period. We ?nd self-reported medical diagnoses are subject to considerable response error. More than half of respondents diagnosed in hospital with a condition in the previous two years fail to report the condition when surveyed. Furthermore, one half of those who self-report a cancer or heart attack diagnosis, and two-thirds of those who self-report a stroke diagnosis, have no corresponding hospital record. A major driver of this reporting error appears to be misunderstanding or being unaware of their diagnoses, with false negative reporting rates falling signi?cantly for heart attacks and strokes when using only primary hospital diagnoses to de?ne objective diagnoses. Reporting error is more common among men, older respondents and those with lower cognitive function. Estimates relying on these self-reported variables are therefore potentially subject to sizeable attenuation biases. Our ?ndings illustrate the importance of routine linkage between survey and administrative data.
    Date: 2020–05–29
  11. By: Bierbaum, Mira.; Schmitt, Valérie.
    Abstract: The COVID-19 pandemic has exposed significant gaps in the coverage, comprehensiveness and adequacy of social protection systems worldwide. These gaps have jeopardized the health, incomes and jobs of billions of people. Closing these protection gaps, facilitating faster and inclusive socio-economic recovery and enhancing resilience against future shocks requires more investment in social protection. Yet, more investment alone is not sufficient; countries also need to invest better in universal social protection, that is, to ensure that investments in social protection contribute to building systems that are aligned with international social security standards, in particular the Social Protection Floors Recommendation, 2012 (No. 202), working in tandem with the Social Security (Minimum Standards) Convention, 1952 (No. 102). This working paper is intended for a broad audience and outlines how the guidance provided by Recommendation No. 202 contributes to building nationally owned social protection systems that comprehensively and adequately protect the population and leave no one behind, are financially sustainable and socially just and rely on sound management and good governance.
    Keywords: social protection, social security financing, COVID-19
    Date: 2022

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