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on Economics of Ageing |
| By: | Burkhard Heer; Vito Polito; Mike Wickens; Michael R. Wickens |
| Abstract: | Using an overlapping generations model, two new indicators of public pension system sustainability are proposed: the pension space, which measures the capacity to pay for pension expenditures out of labour taxation, and the pension space exhaustion probability reflecting demographic uncertainties. These measures reveal that the pension spaces of advanced economies are strikingly different. Most nations have little scope to further finance pensions out of labour income taxation over the next thirty years. There is no one-size-fits-all solution. Risk-equivalent pension reforms enhance welfare in the long run, particularly for rapidly ageing nations, but also entail non-negligible transitional costs. |
| Keywords: | ageing, fiscal space, public pension sustainability, overlapping generations model |
| JEL: | E62 H55 H20 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10487&r=age |
| By: | Burkhard Heer (Department of Economics, University of Ausburg, CESifo, Netspar); Vito Polito (Department of Economics, University of Sheffield, CESifo, Netspar); Mike Wickens (Department of Economics, University of York, CESifo, CEPR, Netspar, Cardiff University) |
| Abstract: | Using an overlapping generations model, two new indicators of public pension system sustainability are proposed: the pension space, which measures the capacity to pay for pension expenditures out of labour taxation, and the pension space exhaustion probability reflecting demographic uncertainties. These measures reveal that the pension spaces of advanced economies are strikingly different. Most nations have little scope to further finance pensions out of labour income taxation over the next thirty years. There is no one-size-fits-all solution. Risk-equivalent pension reforms enhance welfare in the long run, particularly for rapidly ageing nations, but also entail non-negligible transitional costs. |
| Keywords: | Ageing, Fiscal Space, Public Pension Sustainability, Overlapping Generations Model |
| JEL: | E62 H55 H20 |
| Date: | 2023–06 |
| URL: | http://d.repec.org/n?u=RePEc:shf:wpaper:2023014&r=age |
| By: | Joonas Ollonqvist (Finnish Institute for Health and Welfare); Kaisa Kotakorpi (Tampere University, Finnish Centre of Excellence in Tax Systems Research); Mikko Laaksonen (Finnish Centre for Pensions); Pekka Martikainen (University of Helsinki, Max Planck Institute for Demographic Research, and Max Planck â University of Helsinki Center for Social Inequalities in Population Health); Jukka Pirttilä (University of Helsinki, VATT Institute for Economic Research, and Finnish Centre of Excellence in Tax Systems Research); Lasse Tarkiainen (University of Helsinki) |
| Abstract: | We analyse the effects of changes in retirement incentives on retirement behaviour, utilising a Finnish pension reform implemented in 2005. The reform generated financial incentives to postpone retirement for some groups of individuals. Using detailed administrative data on individual health, we focus on whether individual reactions to incentives vary according to health status, and analyse whether individuals with poor health are also able to take advantage of the potential monetary benefits associated with the reform. We find that many types of individuals react to retirement incentives, and the reaction does not vary according to health status in a systematic way. Hence there does not seem to be a trade-off between providing incentives to postpone retirement and equal treatment of individuals with different health status. |
| Keywords: | Pension reform, retirement incentives, health |
| JEL: | H55 J26 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:fit:wpaper:11&r=age |
| By: | Siavash Radpour; Teresa Ghilarducci (Schwartz Center for Economic Policy Analysis (SCEPA)) |
| Abstract: | Up to 40 percent of middle-income workers are at risk of downward mobility into poverty or near-poverty in retirement because of an inefficient retirement system that disproportionately benefits those with high incomes. Universal retirement accounts and providing workers with more equitable and better targeted tax incentives are among the best methods to supplement Social Security and prevent downward mobility in retirement. |
| Keywords: | Universal retirement accounts, low-income, Workers, Jobs, Unemployment, Risk, Older workers, retirement income, retirement, retirement savings |
| JEL: | E24 I14 J62 J38 E21 J83 J32 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:epa:cepapn:2022-01&r=age |
| By: | Georgeta Stoica-Marcu (Ovidius University from Constanta, Romania) |
| Abstract: | Communication is essential in the relationship with the elderly, especially when faced with certain diseases. The difficulties in communication occur even more the older the age and the more advanced the disease, cardiovascular diseases being the main cause of premature death in the world and being constantly increasing. Disability and death caused by cardiovascular disease have reached alarming levels around the globe, especially affecting people over 65; therefore, communication with the elderly can be challenging, but it is vital. |
| Keywords: | communication, elderly people, good communication, cardiovascular disease |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:smo:raiswp:0220&r=age |
| By: | Elisabeth Artmann; Nicola Fuchs-Schündeln; Giulia Giupponi |
| Abstract: | We provide new evidence of forward-looking labor supply responses to changes in pension wealth. We exploit a 2014 German reform that increased pension wealth for mothers by an average of 4.4% per child born before January 1, 1992. Using administrative data on the universe of working histories, we implement a difference-in-differences design comparing women who had their first child before versus after January 1, 1992. We document significant reductions in labor earnings, driven by intensive margin responses. Our estimates imply that, on average, an extra euro of pension wealth in a given period reduces unconditional labor earnings by 54 cents. |
| Keywords: | labor supply, social security, pension wealth |
| JEL: | H55 J22 J26 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10427&r=age |
| By: | Terhi Ravaska (Tampere University & VATT Institute for Economic Research) |
| Abstract: | I examine the effects of reduced working hours on various health outcomes. I focus on individuals close to retirement and exploit a reform in part-time pen- sion rules. Using detailed register data on health and job spells together with a difference-in-differences approach, I find that an earlier eligibility age for part-time pension program increased purchases of prescription drugs by approximately 1.0 percentage point over the following 6 years. In relative terms, this effect is small, around 2%, but is economically significant as drug purchases are largely subsidized by the state. However, looking at the long-term effects I do not find effects on mortality or severe health diagnoses. I also look at labour market exits and find that the reform did not reduce the risk of early withdrawal from the labour market. |
| Keywords: | taxation, emigration |
| JEL: | I11 H42 I18 |
| Date: | 2023–02 |
| URL: | http://d.repec.org/n?u=RePEc:fit:wpaper:6&r=age |
| By: | Hackmann, Martin B. (NBER); Pohl, Vincent (Mathematica); Ziebarth, Nicolas R. (ZEW) |
| Abstract: | How do patient and provider incentives affect the provision of long-term care? Our analysis of 551 thousand nursing home stays yields three main insights. First, Medicaid-covered residents prolong their stays instead of transitioning to community-based care due to limited cost-sharing. Second, when facility capacity binds, nursing homes shorten Medicaid stays to admit more profitable out-of-pocket private payers. Third, providers react more elastically to financial incentives than patients. Thus, targeting provider incentives through alternative payment models, such as episode-based reimbursement, is more effective than increasing patient cost-sharing in facilitating transitions to community-based care and generating long-term care savings. |
| Keywords: | long-term care, nursing homes, patient incentives, provider incentives, cost-sharing, episode-based reimbursement, Medicaid |
| JEL: | H51 H75 I11 I13 I18 J14 |
| Date: | 2023–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16165&r=age |
| By: | Cheung, Hiu Ying (Tsinghua University); Fu, Yu Qi (Tsinghua University); Yang, Zan (Department of Real Estate and Construction Management, Royal Institute of Technology) |
| Abstract: | The complex interactions among multiple service providers pose challenges to the delivery of community-based care for older people. Through the lens of the welfare pluralism theory, this study provides the first understanding of older people’s decisions regarding within-family /community-based care under complex interactions among the government, enterprises, communities, and families. Based on a survey of older people in 2, 883 corresponding families and 184 communities in China, we utilize a logit regression to empirically examine the factors that influence older people’s care decisions, as identified by an equilibrium model. We find that the government subsidy and local wage level effectively promote older people’s decisions to community-based care. We highlight the importance of governments’ direct care provisions in promoting aging in place and efforts to mitigate regional inequalities. |
| Keywords: | aging in place; community-based care; welfare pluralism theory |
| JEL: | H53 I31 J14 |
| Date: | 2023–06–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:kthrec:2023_007&r=age |
| By: | Bertrand Achou; Philippe De Donder; Franca Glenzer; Minjoon Lee; Marie-Louise Leroux |
| Abstract: | Marginal utility of financial resources when needing long-term care, and the related incentives for precautionary savings and insurance, may vary significantly by whether one receives care at home or in a nursing home. In this paper, we develop strategic survey questions to estimate those differences. All else equal, we find that the marginal utility is significantly higher when receiving care at home rather than in a nursing home. We then use these estimates within a quantitative life cycle model to evaluate the impact of the expected choice of care setting (home versus nursing home) on precautionary savings and insurance valuation. The estimated marginal utility differences imply a significant increase in the incentives to save when expecting to receive care at home. Larger incentives to self-insure also translate to a higher valuation of additional subsidies for home care than for nursing homes, shedding light on an efficient way to expand public long-term care subsidies. We also examine how the magnitude of our results quantitatively vary with the existing public long-term care subsidies. L’utilité marginale des ressources financières lorsque les personnes nécessitent des soins de longue durée (ainsi que les incitations à épargner et à s’assurer en découlant) peuvent varier substantiellement suivant que les personnes reçoivent ces soins à la maison ou en CHSLD. Dans ce travail, nous développons un sondage en vue d’évaluer ces différences. Toute chose égale par ailleurs, nous montrons que l’utilité marginale des ressources financières est plus élevée pour ceux qui restent chez eux plutôt que d’être en institution. Nos estimés sont ensuite utilisés dans un modèle de cycle de vie de manière à quantifier l’impact d’un choix de résidence spécifique sur l’épargne de précaution et la valorisation de l’assurance. Les différences d’utilité marginale des ressources impliquent que les personnes prévoyant de recevoir des soins à domicile ont des incitatifs plus fortes à épargner. Des incitatifs plus élevés à s’assurer se traduisent par une valorisation plus importante de subventions publiques additionnelles pour les soins à domicile (plutôt qu’en CHSLD), qui devraient donc être privilégiées par les autorités. L’étude examine également comment ces résultats varient en fonction du montant des subventions aux soins de longue durée déjà existantes. |
| Keywords: | Long-term Care, Marginal Utility, Home Care, Nursing Home, Savings, Soins de longue durée, Utilité marginale, Soins à domicile, Maison de retraite, Ãpargne |
| JEL: | D14 E21 G51 I10 |
| Date: | 2023–06–09 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2023s-14&r=age |
| By: | Asatryan, Zareh |
| Abstract: | Aging societies face a fundamental challenge: How to represent future oriented policies in the politics of today? Voting age reforms and, more generally, policies that encourage the participation of the youth in politics are discussed as one solution. In this report, we study whether voting age reforms are radical enough to save us from gerontocracy. We show that there are certain policy fields that have strong age gradients. Although these are very far from being linear and often go in unexpected directions compared to a view that sees voters as simple self-interested actors. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewexb:2204&r=age |
| By: | Alfonso R. Sánchez Martín |
| Abstract: | Este trabajo presenta los cambios introducidos en el modelo MSSP-OLG con el objeto de lograr una mejor reproducción de la heterogeneidad observada en los ingresos por pensiones y en las bases de cotización en España. Se motiva la importancia de ambos cambios para conseguir una buena reproducción de las sendas de gasto en pensiones y para explorar algunas de las reformas recientes del Sistema, que afectan especialmente a los segmentos más altos de la distribución de ingresos. |
| Date: | 2023–06 |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2023-04&r=age |
| By: | José Ignacio Conde-Ruiz; Vincenzo Galasso |
| Abstract: | La mayoría de los países de la OCDE están envejeciendo rápidamente, debido a una gran reducción en las tasas de fertilidad y a un gran aumento en la esperanza de vida, particularmente en la vejez. Se espera que estos fenómenos continúen y pongan en peligro la sostenibilidad financiera de muchos programas de Estado de Bienestar. Sin embargo, el envejecimiento de la población aumenta la relevancia política de las generaciones mayores. En países como Italia y España, que ya se caracterizan por una distribución intergeneracional desigual (e injusta) de los recursos, el efecto político del envejecimiento puede conducir a una mayor desigualdad intergeneracional. Para limitar este efecto electoral del envejecimiento, se necesitan normas constitucionales que protejan a las generaciones jóvenes y futuras. |
| Date: | 2023–06 |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdapop:2023-03&r=age |