nep-age New Economics Papers
on Economics of Ageing
Issue of 2022‒11‒14
fourteen papers chosen by
Claudia Villosio
LABORatorio R. Revelli

  1. The health-Consumption Effects of Increasing Retirement Age Late in the Game By Eve Caroli; Catherine Pollak; Muriel Roger
  2. One Country, Two Systems : Evidence on Retirement Patterns in China By Giles,John T.; Lei,Xiaoyan; Wang,Gewei; Wang,Yafeng; Zhao,Yaohui
  3. Long-term care in the context of population ageing a rights-based approach to universal coverage By Main author,; Tessier, Lou,; de Wulf, Nathalie,; Momose, Yuta,
  4. Temporal Discounting in Later Life By Kulati, Ellam; Myck, Michal; Pasini, Giacomo
  5. Older Workers’ Employment and Social Security Spillovers through the Second Year of the COVID-19 Pandemic By Gopi Shah Goda; Emilie Jackson; Lauren Hersch Nicholas; Sarah Stith
  6. Pension Reforms, Labor supply and Savings. The Importance of Natural Experiments for Structural Estimation By Schneider, Ulrich; Groneck, Max
  7. Trust in pension funds, or the importance of being financially sound By van Dalen, Hendrik Peter; Henkens, C.J.I.M.
  8. What Is the Outlook for China’s External Surplus? By Hunter L. Clark; Matthew Higgins
  9. Trust and Distrust in Pension Providers in Times of Decline and Reform By van Dalen, Hendrik Peter; Henkens, K.
  10. Estimating the Gains from International Diversification : The Case of Pension Funds By Afanador,Juan Pablo; Davis,Richard Mark; Pedraza Morales,Alvaro Enrique
  11. A U.S. Home Equity Withdrawal Scheme By De Koning, Kees
  12. Between Beveridge and Bismarck: Preferences for Redistribution through Public Pensions By Breunig, Christian; Breyer, Friedrich; Kapteina, Mark; Schwerdt, Guido; Sterba, Maj-Britt
  13. Why Aging Induces Deflation and Secular Stagnation By R. Anton Braun; Daisuke Ikeda
  14. Are Long-Lived Persons Utility Monsters? By Ponthiere, Gregory

  1. By: Eve Caroli (LEDa - Université Paris Dauphine - PSL and IZA); Catherine Pollak (DRESS and LEDa - Université Paris Dauphine - PSL); Muriel Roger (Centre d'Economie de la Sorbonne - Université Paris 1 Panthéon-Sorbonne and LIEPP)
    Abstract: Using the differentiated increase in retirement age across cohorts introduced by the 2010 French pension reform, we estimate the health-consumption effects of a 4-month increase in retirement age. We focus on individuals who were close to retirement age but not retired yet by the time the reform was passed. Using administrative data on individual sick-leave claims and non-hospital health-care expenses, we show that the probability of having at least one sickness absence increases for all treated groups, while the duration of sick leaves remains unchanged. Delaying retirement does not increase the probability of seeing a GP, except for men in the younger cohorts. In contrast, it raises the probability of having a visit with a specialist physician for all individuals, except men in the older cohorts. Delaying retirement also increases the probability of seeing a physiotherapist among women from the older cohorts. Overall, it increases health expense claims, in particular in the lower part of the expenditure distribution
    Keywords: pension reform; retirement age; health; health-care consumption
    JEL: I10 J14 J18 J26
    Date: 2022–10
  2. By: Giles,John T.; Lei,Xiaoyan; Wang,Gewei; Wang,Yafeng; Zhao,Yaohui
    Abstract: This paper documents the patterns and correlates of retirement in China using a nationally representative survey, the China Health and Retirement Longitudinal Study. After documenting stark differences in retirement ages between urban and rural residents, the paper shows that China's urban residents retire earlier than workers in many Organisation for Economic Co-operation and Development countries and that rural residents continue to work until advanced ages. Differences in access to generous pensions and economic resources explain much of the urban-rural difference in retirement rates. Fending off the fiscal pressures resulting from rapid population aging will require encouraging longer working lives among more highly educated and skilled workers living in China's urban areas. The paper suggests that reducing disincentives created by China's employee pension system, improving health status, providing childcare, and elder care support may all facilitate longer working lives. Given spouse preferences for joint retirement, creating incentives for women to retire later may facilitate longer working lives for men and women.
    Keywords: Pensions&Retirement Systems,Health Care Services Industry,Labor Markets,Educational Sciences,Adolescent Health
    Date: 2021–05–06
  3. By: Main author,; Tessier, Lou,; de Wulf, Nathalie,; Momose, Yuta,
    Abstract: Abstract.
    Date: 2022
  4. By: Kulati, Ellam (Warsaw University); Myck, Michal (Centre for Economic Analysis, CenEA); Pasini, Giacomo (Ca' Foscari University of Venice)
    Abstract: We explore intertemporal decision-making in later life by looking at temporal preference heterogeneity among older individuals. Using choice tasks responses from Poland collected as part of the Survey of Health, Ageing, and Retirement in Europe (SHARE), we elicit individual time preferences using competing discounting specifications. With the formulation that best fits our data, we examine which individual characteristics drive the estimated heterogeneity in later life time preferences. Individual numerical abilities, labour and marital status, as well as household income turn out to be significant correlates of patience. Our analysis also provides methodological guidance for instrument design with the aim of eliciting time preferences in a general survey setting.
    Keywords: time preferences, discount rate, present bias, survey methodology, old age
    JEL: D12 D15 C83 J14
    Date: 2022–10
  5. By: Gopi Shah Goda; Emilie Jackson; Lauren Hersch Nicholas; Sarah Stith
    Abstract: The COVID-19 pandemic triggered a large and immediate drop in employment among US workers, along with major expansions of unemployment insurance and work from home. We use Current Population Survey and Social Security application data to study employment among older adults and their participation in disability and retirement insurance programs through the second year of the pandemic. We find ongoing improvements in employment outcomes among older workers in the labor force, along with sustained higher levels in the share no longer in the labor force during this period. Applications for Social Security disability benefits remain depressed, particularly for Supplemental Security Income. In models accounting for the expiration of expanded unemployment insurance, we find that the loss of these additional financial supports is associated with a drop in older adult unemployment rates and an increase in Social Security Disability Insurance claiming. Social Security retirement benefit claiming has rebounded to pre-pandemic levels, but has shifted from offline to online applications.
    JEL: H31 H5 J14 J26
    Date: 2022–10
  6. By: Schneider, Ulrich; Groneck, Max
    JEL: D15 D81 H31 J26
    Date: 2022
  7. By: van Dalen, Hendrik Peter (Tilburg University, School of Economics and Management); Henkens, C.J.I.M. (Tilburg University, School of Economics and Management)
    Date: 2022
  8. By: Hunter L. Clark; Matthew Higgins
    Abstract: The sharp slowdown in China’s property sector has reignited debate over the country’s future role as a net provider of savings to the global economy. The debate revolves around whether a sustained decline in property investment will spur a long-term increase in China’s current account surplus, given the country’s high savings rate. However, China’s rapidly aging population presents opposing forces that complicate this story. The shift of a large share of its population from working life to retirement will reduce savings supply even as a shrinking labor force will reduce investment demand. In this post, we focus on the demographic part of the story and find that this force will exert considerable downward pressure on China’s current account surplus in coming years.
    Keywords: China; savings; balance of payments; current account; demographics; trade
    JEL: F00
    Date: 2022–10–17
  9. By: van Dalen, Hendrik Peter (Tilburg University, School of Economics and Management); Henkens, K. (Tilburg University, School of Economics and Management)
    Date: 2022
  10. By: Afanador,Juan Pablo; Davis,Richard Mark; Pedraza Morales,Alvaro Enrique
    Abstract: For pension funds, international assets represent an opportunity to improve their returns while possibly reducing risks. Nonetheless, pension funds in many developing countries face regulations that limit the choice of international investments. This paper proposes a new methodology to estimate the gains from international diversification in which the optimal asset allocation of pension funds is constrained by financial frictions. The empirical strategy is applied to the aggregate holdings of pension funds in a large group of countries to calculate the gains from increasing the current level of exposure to international securities. The methodology should give policy makers the opportunity to identify jurisdictions where pension funds could benefit the most from expanding their foreign holdings.
    Keywords: Social Funds and Pensions,Capital Markets and Capital Flows,Capital Flows,Non Bank Financial Institutions,International Trade and Trade Rules,Financial Sector Policy,Adolescent Health
    Date: 2021–04–20
  11. By: De Koning, Kees
    Abstract: In the U.S. total pension assets level stands at $27.6 trillion and total net home equity amounts to $29.04 trillion. The U.S expected GDP level for 2022 is $23.4 trillion. U.S. total Government expenditure for this year is $9.32 trillion. The suggestion in this paper is to create a structure that does not rely on government spending but allows most households to use some of their home equity to stimulate the economy. U.S. households already have the right to withdraw up to 25% of their pension savings -an age related structure-. Home equity withdrawal would be anti recession based tool.
    Keywords: Home equity withdrawal; U.S government debt restrictions; Quantitative Easing Home Equity.
    JEL: E21 E22 E24 E27 E31 E5 E51 G18
    Date: 2022–10–21
  12. By: Breunig, Christian; Breyer, Friedrich; Kapteina, Mark; Schwerdt, Guido; Sterba, Maj-Britt
    JEL: H55 D72 D83
    Date: 2022
  13. By: R. Anton Braun (Federal Reserve Bank of Atlanta (E-mail:; Daisuke Ikeda (Director, Financial System and Bank Examination Department, Bank of Japan (E-mail:
    Abstract: We provide a quantitative theory of deflation and secular stagnation. In our lifecycle framework an aging population puts persistent downward pressure on the price level, real interest rates, and output. A novel feature of our theory is that it also recognizes the reactions of government policy. The central bank responds to falling prices by reducing its policy nominal interest rate and the fiscal authority responds by allowing the public debt-GDP ratio to rise.
    Keywords: Aging, Deflation, Lifecycle, Monetary policy, Portfolio choice, Secular stagnation, Tobin effect
    JEL: E52 E62 G51 D15
    Date: 2022–10
  14. By: Ponthiere, Gregory
    Abstract: Nozick's "utility monster" - a being who is more efficient than other persons at transforming resources into well-being - is often regarded as deeply impossible, on the ground of the incapacity of a single person to have a life that is better than a large number of other lives. In this article, I defend a purely marginalist view of the "utility monster", that is, that the primary characteristic of a "utility monster" is a higher sensitivity, at the margin, of well-being to resources, rather than a larger total well-being. I propose three purely marginalist accounts of "utility monster" and I introduce the related concept of "collective utility monster", in order to account for the collective predation of (almost) all resources by a group of persons. I argue that, although a long-lived person, if taken separately, could hardly belong to the category of "utility monster", a large group of long-lived persons can, under some conditions, belong to the category of "collective utility monster". In the light of the increasingly large proportion of cohorts reaching very old ages nowadays, Nozick's objection against utilitarianism turns out, after a thorough review, to be most relevant for real-world aging societies.
    Keywords: longevity,mortality,inequalities,utilitarianism,Nozick's utility monster
    JEL: I31 J10 J18
    Date: 2022

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