nep-age New Economics Papers
on Economics of Ageing
Issue of 2024‒01‒08
thirteen papers chosen by
Claudia Villosio, LABORatorio R. Revelli

  1. When Institutions Interact: How the Effects of Unemployment Insurance are Shaped by Retirement Policies By Matthew Gudgeon; Pablo Guzman-Pinto; Johannes Schmieder; Simon Trenkle; Han Ye
  2. Encourager à travailler plus longtemps sans pénaliser ceux qui ne le peuvent pas By Collot, Laurent; Hindriks, Jean
  3. A Simple Two Period Overlapping Generation (OLG) Model For Public Pension Scheme (PAYG) By Al-Hassan, Hassana; Devolder, Pierre; Nayrko, Christiana; Nokoh, K. Sagary
  4. Effective Fiscal Policy in an Aging Economy: Evidence from a BVAR Analysis By Puonti, Päivi
  5. A better performing labour market for inclusive convergence in Croatia By Tim Bulman
  6. Are Senior Entrepreneurs Happier than Who?: The Role of Income and Health By Michael Fritsch; Alina Sorgner; Michael Wyrwich
  7. Unionization of Retired Workers in Europe By Pyka, Vinzenz; Schnabel, Claus
  8. The Wealth of Working Nations By Jesús Fernández-Villaverde; Gustavo Ventura; Wen Yao
  9. The “Demise of the Caregiving Daughter”? Gender Employment Gaps and the Use of Formal and Informal Care in Europe By Eric Bonsang; Joan Costa-Font; Joan Costa-i-Font
  10. Household Wealth and Body Mass Index: Towards a Healthy Ageing? By Belloc, Ignacio; Molina, José Alberto; Velilla, Jorge
  11. Using Within-Person Change in Three Large Panel Studies to Estimate Personality Age Trajectories By Ingo S. Seifert; Julia M. Rohrer; Stefan C. Schmukle
  12. Use of Digital Technologies to Maintain Older Adults’ Social Ties During Visitation Restrictions in Long-Term Care Facilities: Scoping Review By Célia Lemaire; Christophe Humbert; Cédric Sueur; Céline Racin
  13. Nothing really matters: Evaluating demand-sidemoderators of age discrimination in hiring By Axana Dalle; Louis Lippens; Stijn Baert

  1. By: Matthew Gudgeon; Pablo Guzman-Pinto; Johannes Schmieder; Simon Trenkle; Han Ye
    Abstract: This paper shows empirically that the non-employment effects of unemployment insurance (UI) for older workers depend in a first-order way on the structure of retirement policies. Using German data, we first present reduced-form evidence of these interactions, documenting large bunching in UI inflows at the age that allows workers to claim their pension following UI expiration. We then estimate a dynamic life-cycle model and use it to directly quantify how the effects of UI vary with retirement policies. Accounting for interactions across UI and retirement institutions also helps explain otherwise difficult-to-explain trends in the unemployment rate of older German workers.
    Keywords: Unemployment insurance, moral hazard, retirement, older workers, interactions
    JEL: J26 J64 J65
    Date: 2023–12
  2. By: Collot, Laurent (UNamur); Hindriks, Jean (Université catholique de Louvain, LIDAM/CORE, Belgium)
    Abstract: Si nous voulons maintenir la pérennité de nos pensions, nous allons devoir travailler plus longtemps. Comment faire cela sans porter atteinte à ceux qui ont commencé leur carrière plus tôt et qui sont exposés à des métiers pénibles. Dans cet article, nous proposons d’intégrer l’âge de début de carrière et la pénibilité des métiers explicitement dans notre régime de pension. L’âge d’accès à la pension est indexé sur l’âge de début de carrière. Une enveloppe de métiers pénibles est fixée par niveaux de revenu avec une distribution organisée entre partenaires sociaux au sein des secteurs. La compensation pénibilité se fait sous forme d’années d’anticipation de pension. Nous calculons le coût budgétaire de la compensation que nous finançons par un ajustement des pensions les plus élevées. Nos résultats suggèrent que la compensation pénibilité n’est pas si pénible. Par exemple, octroyer 3 années d’anticipation pénibilité à 30% des travailleurs du premier quintile de salaires, 2 années à 15% des travailleurs du second quintile et 1 année à 7% des travailleurs du troisième quintile impliquent une perte de 1% de la pension moyenne du 4ème quintile et de 4, 69% de la pension moyenne du 5ème quintile.
    Keywords: Social security ; pension ; retirement, ageing
    JEL: H55 J11 J14 J26
    Date: 2023–11–10
  3. By: Al-Hassan, Hassana; Devolder, Pierre (Université catholique de Louvain, LIDAM/ISBA, Belgium); Nayrko, Christiana; Nokoh, K. Sagary
    Abstract: In this paper, we develop in a PAYG public pension system, various ways to share the longevity risk across generations of active affiliates and retirees. We consider a simplified two period Overlapping generation (OLG) model with three major groups: active workers, new retirees and existing retirees. Two levels of risk sharing are proposed; in a first step we develop the sharing between the contributors and the beneficiaries by proposing various designs of the plan, from Defined Benefit to Defined Contribution including hybrid solutions such as Musgrave plans. For this level, the driving force is the dependency ratio. In a second step we consider the sharing between the retirees themselves by considering two important degrees of freedom: the level of the first pension for the new retirees and the revaluation of existing pensions for the older retirees. Different strategies of risk sharing are presented in this framework. We illustrate the concepts by numerical illustrations based on deterministic and stochastic demographic models.
    Keywords: PAYG ; Dependency Ratio ; DB ; DC ; Musgrave ; Risk sharing ; Revaluation
    Date: 2023–11–07
  4. By: Puonti, Päivi
    Abstract: Abstract As people age, their consumption and saving behavior tends to change. At the same time, the share of age-related public spending increases, leaving less resources for fiscal stimulus, especially if public debt ratio is already high. Using Finnish data in a Bayesian VAR model, we show that the composition of public spending matters for the effectiveness of fiscal stimulus in an aging economy. Our results suggest that increasing social transfers targeted mostly to the elderly boosts the economy less than increasing consumption expenditure that financially benefits the working aged population. This is due to a different saving and consumption behavior of the population group benefitting from the fiscal impulse. The results imply that in an aging economy targeting fiscal measures becomes more important than ever.
    Keywords: Population aging, Fiscal policy, Bayesian structural vector autoregressions
    JEL: E62 H30 J10 C11
    Date: 2023–12–12
  5. By: Tim Bulman
    Abstract: Croatia’s labour market has made important progress over the past decade. Employment rates are rising, reducing the gap with OECD countries, and poverty has fallen. While important weaknesses remain, many dimensions of equity and working conditions are similar to OECD countries. Continuing this progress is essential for Croatia’s incomes and well-being to converge with OECD countries, to counter accelerating population ageing and to make the most of emerging opportunities, including from digitalisation and the green economy transition. For employers, filling increasingly advanced skill needs is a growing obstacle. Relatively few of the young and older adults are in work – contributing to weakening skills, lower incomes and higher poverty risks. Addressing these challenges will require dramatically expanding participation in re-skilling and adult education programmes, and raising the workforce’s flexibility, for example by strengthening active labour market policies, improving the housing market’s dynamism and making the most of immigrants’ and returned emigrants’ skills. This Working Paper relates to the 2023 OECD Economic Survey of Croatia.
    Keywords: access to housing, active labour market policies, adult, demographics, education and training, pension policies, skills, social protection, wage setting
    JEL: H24 H5 I2 I3 J11 J2 J3 J61 J65 R23 R31
    Date: 2023–12–12
  6. By: Michael Fritsch; Alina Sorgner; Michael Wyrwich
    Abstract: We propose an extension of the standard occupational choice model to analyze the life satisfaction of senior entrepreneurs as compared to paid employees and particularly retirees in Germany. The analysis identifies income and health status as main factors that shape the relationship between occupational status and life satisfaction. Senior entrepreneurs enjoy higher levels of life satisfaction than retirees and senior paid employees. This higher life satisfaction is mainly due to their higher income. Physical and mental health play a crucial role in determining both an individual’s occupational status and their overall life satisfaction. We find that senior self-employed report to be healthier compared to other groups of elderly individuals. However, when controlling for health, retirees exhibit an even higher level of life satisfaction compared to their self-employed counterparts. Heterogeneity analysis of various types of senior entrepreneurs and senior paid employees confirms this general pattern. In addition, we find some evidence indicating that senior entrepreneurs may compromise their leisure time, a main asset of retired individuals. Implications for research, policy, and practitioners are discussed.
    Keywords: Senior entrepreneurship, health conditions, well‐being, life satisfaction, age
    JEL: L26 I31 J10 D91
    Date: 2023
  7. By: Pyka, Vinzenz (University of Erlangen-Nuremberg); Schnabel, Claus (University of Erlangen-Nuremberg)
    Abstract: We shed light on an understudied group: retirees in unions. Using representative individual-level data of 19 European countries, we find that the share of retirees in unions and the union density of retirees increased between 2008 and 2020. Econometric analyses indicate that on average retired workers' probability of union membership is 17 percentage points lower than that of active workers. This finding is consistent with social custom models and cost-benefit considerations. We further find that some determinants of union membership differ between active and retired workers and that standard membership models better explain the unionization of active than retired workers.
    Keywords: trade union, retirement, union membership, Europe
    JEL: J26 J51
    Date: 2023–11
  8. By: Jesús Fernández-Villaverde; Gustavo Ventura; Wen Yao
    Abstract: Due to population aging, GDP growth per capita and GDP growth per working-age adult have become quite different among many advanced economies over the last several decades. Countries whose GDP growth per capita performance has been lackluster, like Japan, have done surprisingly well in terms of GDP growth per working-age adult. Indeed, from 1998 to 2019, Japan has grown slightly faster than the U.S. in terms of per working-age adult: an accumulated 31.9% vs. 29.5%. Furthermore, many advanced economies appear to be on parallel balanced growth trajectories in terms of working-age adults despite important differences in levels. Motivated by this observation, we calibrate a standard neoclassical growth model in which the growth of the working-age adult population varies in line with the data for each economy. Despite the underlying demographic differences, the calibrated model tracks output per working-age adult in most economies of our sample. Our results imply that the growth behavior of mature, aging economies is not puzzling from a theoretical perspective.
    JEL: E20 J10
    Date: 2023–11
  9. By: Eric Bonsang; Joan Costa-Font; Joan Costa-i-Font
    Abstract: We revisit the universality of the “caregiving daughter effect”, which holds that daughters tend to provide more care to their older parents than sons. Based on rich European data, we document evidence of such an effect in countries with large gender disparities in employment rates, where having daughters also depresses the demand for formal care. In contrast, we find evidence consistent with the “demise of the caregiving daughter” when exposed to narrower gender gaps, where there is no more daughters’ effect on formal care. These results point to a reconsideration of caregiving system design amidst the rise of female employment.
    Keywords: informal care, formal care, daughters, caregiving daughter effect, gender employment gap, Europe, care substitution, social norms
    JEL: I18 J14 J30
    Date: 2023
  10. By: Belloc, Ignacio; Molina, José Alberto; Velilla, Jorge
    Abstract: Studying the impact of exogenous wealth shocks on health-related outcomes can help policymakers in the design and evaluation of social programs that provide income to certain groups. This paper analyzes the impact of unexpected inheritances on Body Mass Index, using data from the Survey of Health, Ageing and Retirement in Europe, including 15 countries from 2004 to 2017. The results show that the receipt of an inheritance is negatively associated with BMI, and being overweight among females. When we account for individual heterogeneity, we find that the receipt of an unexpected inheritance reduces the probability of being overweight by 2.8% among women, and it increases the probability of women engaging in activities that involve moderate physical activity, and increases the amount spent on eating out. These results suggest that large increases in wealth may improve current weight problems and maintain higher life standards among women in later life, so policymakers may include the potential health-related benefits when implementing redistribution programs within those households.
    Keywords: Body Mass Index, Unexpected inheritances, Ageing, Europe, SHARE
    JEL: G51 I12 J14 O52
    Date: 2023
  11. By: Ingo S. Seifert; Julia M. Rohrer; Stefan C. Schmukle
    Abstract: How does personality change when people get older? Numerous studies have investigated this question, overall supporting the idea of so-called personality maturation. However, heterogeneous findings have left open questions, such as whether maturation continues in old age and how large the effects are. We suggest that the heterogeneity is partly rooted in methodological issues. First, studies may have failed to recover age effects, as they did not stringently separate within-person changes from confounding between-person differences. Second, items supposedly belonging to the same trait may show different individual trajectories, thus rendering results sensitive to the specific set of items used. We analyzed panel data from Australia (N = 15, 268; Study 1), Germany (N = 22, 833; Study 2), and the Netherlands (N = 10, 163; Study 3) to investigate age trends in the Big Five on the levels of both scores and items. We applied a fixed effects approach that incorporates only within-person changes over time. Developmental trends in the Big Five scores were generally moderate to large and broadly confirmed personality maturation at younger ages. At older ages, maturation consistently continued for Neuroticism, whereas we found mixed evidence for such changes in Conscientiousness and Agreeableness. Furthermore, in each study, individual items showed age trends that diverged from the rest of the corresponding trait; and these differential patterns could be partly replicated across the three studies. Our results highlight the importance of items in the study of personality development and provide an explanation for previously unaccounted for variability in age trends.
    Keywords: Personality development, mean-level change, Big Five, panel studies, fixed effects modeling
    Date: 2023
  12. By: Célia Lemaire (Laboratoire de Recherche Magellan - UJML - Université Jean Moulin - Lyon 3 - Université de Lyon - Institut d'Administration des Entreprises (IAE) - Lyon, ULaval - Université Laval [Québec]); Christophe Humbert; Cédric Sueur (IPHC - Institut Pluridisciplinaire Hubert Curien - UNISTRA - Université de Strasbourg - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - IN2P3 - Institut National de Physique Nucléaire et de Physique des Particules du CNRS - CNRS - Centre National de la Recherche Scientifique); Céline Racin (SULISOM - Subjéctivité, lien social et modernité - UNISTRA - Université de Strasbourg)
    Abstract: Background Digital technologies were implemented to address the disruption of long-term care facility residents' socialization needs during the COVID-19 pandemic. A literature review regarding this topic is needed to inform public policy, facility managers, family caregivers, and nurses and allied health professionals involved in mediating the use of digital devices for residents' social ties. Objective Our study outlines key concepts, methodologies, results, issues, and gaps in articles published during pandemic-related visitation restrictions. Methods Following the PRISMA-ScR (Preferred Reporting Items for Systematic Reviews and Meta-Analyses Extension for Scoping Reviews) protocol, a scoping review was conducted by searching 3 database aggregator platforms (EBSCO, ProQuest, and PubMed) for studies published in peer-reviewed journals from early 2020 to the end of June 2021, when the most stringent restrictions were in place. We included qualitative and quantitative studies, reviews, commentaries, viewpoints, and letters to the editors in French or English focusing on digital technologies aiming to support the social contact of residents in long-term care facilities during pandemic-related visitation restrictions. Results Among 763 screened articles, 29 met our selection criteria. For each study, we characterized the (1) authors, title, and date of the publication; (2) country of the first author; (3) research fields; (4) article type; and (5) type of technology mentioned. The analysis distinguished 3 main themes emerging from the literature: (1) impact and expectations of remote social contact on the physical and mental health and well-being of the residents (n=12), (2) with whom or what the social contact took place (n=17), and (3) limitations and barriers to significant social contact related to digital technologies (n=14). The results first underlined the highly positive impact expected by the authors of the digital technologies on health and quality of life of residents of long-term care facilities. Second, they highlighted the plurality of ties to consider, since social contact takes place not only with family caregivers to maintain contact but also for other purposes (end-of-life videoconferences) and with other types of contact (eg, with staff and robots). Third, they exposed the limitations and barriers to significant contact using digital technologies and outlined the required conditions to enable them. Conclusions The review demonstrated the opportunities and risks outlined by the literature about the implementation of digital technologies to support remote social contact. It showed the plurality of ties to consider and revealed the need to evaluate the positive impact of remote contact from the residents' perspectives. Therefore, to go beyond the risk of digital solutionism, there is a need for studies considering the holistic impact on health regarding the implementation of digital technologies, including the meaning residents give to interpersonal exchanges and the organizational constraints. Trial Registration OSF Registries;
    Date: 2023
  13. By: Axana Dalle; Louis Lippens; Stijn Baert (-)
    Abstract: As age discrimination hampers the OECD’s ambition to extend the working population, an efficient antidiscrimination policy targeted at the right employers is critical. Therefore, the context in which age discrimination is most prevalent must be identified. In this study, we thoroughly review the current theoretical arguments and empirical findings regarding moderators of age discrimination in different demand-side domains (i.e. decision-maker, vacancy, occupation, organisation, and sector). Our review demonstrates that the current literature is highly fragmented and often lacks field-experimental evidence, raising concerns about itsinternal and external validity.To addressthis gap, we conducted a correspondence experiment and systematically linked the resulting data to external data sources. In so doing, we were able to study the priorly determined demand-side moderators within a single multi-level analysis and simultaneously control multiple correlations between potential moderators and discrimination estimates. Having done so, we found no empirical support for any of these moderators.
    Keywords: Ageism; Hiring discrimination; Heterogeneity;Literature review;Field experiment; Administrative data
    JEL: J71 J23 J14
    Date: 2023–12

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