nep-age New Economics Papers
on Economics of Ageing
Issue of 2024‒04‒15
fifteen papers chosen by
Claudia Villosio, LABORatorio R. Revelli

  2. How China's "Later, Longer, Fewer" Campaign Extends Life Expectancy: A Study of Intergenerational Support for Elderly Parents By Bansak, Cynthia; Dziadula, Eva; Wang, Sophie Xuefei
  3. Kinlessness at older ages: Prevalence and heterogeneity in 27 countries By Marta Pittavino; Bruno Arpino; Elena Pirani
  4. Reforming the US Long-Term Care Insurance Market By R. Anton Braun; Karen A. Kopecky
  5. An Assessment of the 2019 and 2020 Pension Reforms in Mexico By Boele Bonthuis
  6. Impact of women's employment rate on informal care for dependent elders: prospects for Moroccan society By Sébastien Dambrine
  7. Healthcare Quality and Dementia Risk By Aravena, José M.; Chen, Xi; Levy, Becca R.
  8. Impacts of Copayment Change on Health Behaviours for Older People: Evidence from a Japanese Health Policy Reform By Chun Yee Wong; Shugo Shinohara
  9. Predicting a Migration Transition in Poland and its Implications for Population Ageing By Agnieszka Fihel; Anna Janicka; Marek Okólski
  10. A New Testing Method for Justification Bias Using High-Frequency Data of Health and Employment By Jiayi Wen; Zixi Ye; Xuan Zhang
  11. Can Labor Market Imperfections Motivate the Implementation of an Income-Based Pension System? By Gustafsson, Johan; Sjögren, Tomas
  12. Asset Demand and Real Interest Rates By Paul Beaudry; Katya Kartashova; Césaire Meh
  13. Geographical and financial access to nursing homes: theoretical presentation of a measurement indicator By Carole Bonnet; Amélie Carrère; Roméo Fontaine; Agnès Gramain; Jérôme Wittwer
  14. Too Old to Be Included: Age Diversity Statements Increase Diversity but Not Inclusion By Oriana De Saint Priest; Franciska Krings; Claudia Toma
  15. The blurred line between social insurance and social assistance — analysis of risk-based benefits in six countries By Tervola, Jussi; Iivonen, Saija; Hiilamo, Heikki

  1. By: Johan Saeverud (Dept. of Economics, University of Copenhagen)
    Abstract: I investigate a Danish policy reform that postpones social security eligibility tied to an increase in life expectancy. The reform creates sharp discontinuities based on exact birth dates, allowing for the identification of causal effects. Using both administrativeand survey data, I document a substantial increase in labor force participation of 20 percentage points as a result of postponing social security eligibility. The effect isstrongest among individuals with low pension wealth. This pattern is consistent across multiple retirement age thresholds and cohorts, including both individuals who havealready retired and in expectation for younger cohorts who are not yet retired. This research offers new insights into the impacts of life expectancy-based adjustments tosocial security eligibility. Welfare assessments show overall gains, but also that welfare effects are unequally distributed. Individuals with low pension wealth show the largestincreases in labor supply, but also face the largest personal costs in terms of foregone consumption smoothing.
    Keywords: retirement, social security, labor supply
    JEL: J26 H55
    Date: 2024–01–30
  2. By: Bansak, Cynthia (St. Lawrence University); Dziadula, Eva (University of Notre Dame); Wang, Sophie Xuefei (Central University of Finance and Economics)
    Abstract: This study documents increased intergenerational support for elderly parents in China among adults who were exposed to the "Later, Longer, Fewer" (LLF) family planning campaign in the 1970s. Using the China Health and Retirement Longitudinal Study, we identify adults of childbearing age whose fertility was reduced. We find LLF exposure increases the likelihood of wife's parents residing in the same household. As expected in a patrilineal society, the increase in support is realized by the husband's parents through more visits and financial transfers. Supporting our findings of stronger social networks, LLF exposure significantly increases the elderly parent's age at death.
    Keywords: fertility, China, "Later, Longer, Fewer" campaign, family planning, co-residency, intergenerational transfers, aging population
    JEL: H31 I31 J13
    Date: 2024–03
  3. By: Marta Pittavino (Department of Management - Venice School of Management, Ca' Foscari University of Venice); Bruno Arpino (Department of Statistical Sciences and Department of Philosophy, Sociology, Education and Applied Psychology, University of Padua); Elena Pirani (Department of Statistics, Computer Science, Applications 'G. Parenti', Florence)
    Abstract: Availability of kin has profound effects on the lives of people, especially in later life when social networks tend to be composed prevalently of family members, and care needs increase. Using data from the last wave (wave 8; 2019-2020) of the Survey of Health, Ageing and Retirement in Europe (SHARE), we estimate the prevalence of kinlessness (i.e., absence of close kin) among older adults aged 65 and more in 27 countries. We consider different definitions of kinlessness, from a less restrictive (i.e., based only on the absence of both partner and children) to a more restrictive one (based also on the absence of grandchildren, parents and siblings). Results show a large variation of kinlessness across countries. The proportion of adults aged 65 and above who lack both a partner and children range between 2-3.5% in Czech Republic, Romania, Israel, and Bulgaria, and more than 8% in Switzerland, Spain, Belgium and Malta. The percentage of older people lacking all considered kin ranges from 0.1 to 4.1%. In addition, in some countries there is a substantial heterogeneity in kinlessness by age and sex. Differences by education are, instead, rare. Understanding the prevalence of older individuals without close kin is critical for policymakers and healthcare providers to design appropriate support systems for this particularly vulnerable group of older people and their possibly unmet care needs.
    Keywords: Kin; family; older people; aging; SHARE
    Date: 2024–03
  4. By: R. Anton Braun; Karen A. Kopecky
    Abstract: One in three 50-year-old Americans will spend over 90 days in a nursing home, with roughly one in ten facing out-of-pocket expenses exceeding $200, 000. Yet, only about 10 percent of individuals aged 65 or older possess private long-term care insurance (LTCI). While Medicaid provides benefits for those with minimal assets (about $2, 000 or less) and low income, its stringent means-test and private market frictions result in many retirees paying for long-term care (LTC) expenses out-of-pocket. As the American population ages, policymakers anticipate a rise in state and federal Medicaid expenditures. This chapter examines reforms to both public and private LTCI provision using a structural model of the US LTCI market. Three policies are considered: universal public LTCI, no public LTCI coverage, and a policy that exempts asset holdings from the Medicaid asset test on a dollar-for- dollar basis with private LTCI coverage. We find that this third reform enhances social welfare and creates a vibrant private LTCI market while preserving the safety- net provided by Medicaid to low-income individuals.
    Date: 2024–03
  5. By: Boele Bonthuis
    Abstract: In recent years the Mexican pension system has changed significantly. In 2019 the existing means-tested social pension was made universal – covering everyone over the age of 65 – and the benefit level increased. In 2020, the main regime of the private sector was substantially reformed, increasing contribution rates for the funded defined contribution system, lowering the minimum years of contributions needed to receive an earnings-related pension, and increasing minimum pensions. This paper tries to assess the likely outcomes of those reforms, discusses design inefficiencies of the reforms and offers policy options to improve pension system design.
    Keywords: Pension reform; funding; pay-as-you-go; labor supply incentives; design inefficiencies
    Date: 2024–03–08
  6. By: Sébastien Dambrine (CEPN - Centre d'Economie de l'Université Paris Nord - LABEX ICCA - UP13 - Université Paris 13 - Université Sorbonne Nouvelle - Paris 3 - CNRS - Centre National de la Recherche Scientifique - UPCité - Université Paris Cité - Université Sorbonne Paris Nord - CNRS - Centre National de la Recherche Scientifique - Université Sorbonne Paris Nord)
    Abstract: The presented study examines the significant impact of the rise in women's employment rates on the provision of informal care to dependent seniors, with a particular focus on the French context and extrapolating potential implications for Moroccan society. The central research question revolves around the effect of the increase in female participation in the labor market on the availability and quality of informal care provided to the elderly who require sustained care. This inquiry is motivated by the growing recognition of the vital role informal care plays in maintaining dependent seniors at home, a practice deeply rooted in both French and Moroccan social values. To address this issue, the study relies on a mixed methodology, combining the analysis of quantitative data from the Daily Life and Health (VQS) surveys and the Survey of Health, Ageing, and Retirement in Europe (SHARE) with a qualitative approach to deepen the understanding of interpersonal and family dynamics influencing care provision. The econometric methodology used allows isolating the effect of female employment on informal care. The study's findings reveal a negative correlation between the increase in women's employment rates and the availability of informal care for seniors. Specifically, it appears that the growing integration of women into the workforce leads to a reduction in the time and resources available for informal care, highlighting a growing challenge for the sustainability of care systems for dependent elderly individuals. This trend is particularly concerning in the context of rapid demographic aging and the increase in the prevalence of chronic diseases among the elderly population. The conclusion of the study emphasizes the urgency for policymakers, both in France and Morocco, to recognize and address the consequences of these labor market dynamics on the informal care system. It suggests that the development of innovative and gender-sensitive public policies, which facilitate the balance between professional responsibilities and caring for loved ones, will be crucial to ensure the continuity and quality of support provided to dependent seniors.
    Abstract: L'étude présentée examine l'impact significatif de l'augmentation du taux d'emploi des femmes sur la provision d'aide informelle aux séniors dépendants, en mettant un accent particulier sur le contexte français et en extrapolant les implications potentielles pour la société marocaine. La question de recherche centrale s'articule autour de l'effet de la croissance de la participation féminine au marché du travail sur la disponibilité et la qualité de l'aide informelle offerte aux personnes âgées nécessitant des soins soutenus. Cette interrogation est motivée par la reconnaissance croissante du rôle vital que joue l'aide informelle dans le maintien des séniors dépendants à domicile, une pratique profondément enracinée tant dans les valeurs sociales françaises que marocaines. Pour aborder cette question, l'étude s'appuie sur une méthodologie mixte, combinant l'analyse de données quantitatives issues des enquêtes Vie Quotidienne et Santé (VQS) et Survey of Health, Ageing and Retirement in Europe (SHARE) avec une approche qualitative pour approfondir les dynamiques interpersonnelles et familiales influençant la prestation de soins. La méthodologie économétrique employée permet d'isoler l'effet de l'emploi féminin sur l'aide informelle. Les résultats de l'étude révèlent une corrélation négative entre l'augmentation du taux d'emploi des femmes et la disponibilité de l'aide informelle aux séniors. Plus précisément, il apparaît que l'intégration croissante des femmes dans la force de travail conduit à une réduction du temps et des ressources disponibles pour les soins informels, mettant en lumière un défi croissant pour la soutenabilité des systèmes de soins aux personnes âgées dépendantes. Cette tendance est particulièrement préoccupante dans le contexte du vieillissement démographique rapide et de l'augmentation de la prévalence des maladies chroniques parmi les populations âgées. La conclusion de l'étude souligne l'urgence pour les décideurs politiques, tant en France qu'au Maroc, de reconnaître et d'adresser les conséquences de ces dynamiques du marché du travail sur le système de soins informels. Il est suggéré que le développement de politiques publiques innovantes et sensibles au genre, qui facilitent l'équilibre entre les responsabilités professionnelles et de soins aux proches, sera crucial pour assurer la continuité et la qualité de l'aide apportée aux séniors dépendants.
    Keywords: Home assistance, Female employment, Informal aid, Silver Economy, Aide à domicile, Emploi féminin, aide informelle, Silver économie
    Date: 2024
  7. By: Aravena, José M. (Yale University); Chen, Xi (Yale University); Levy, Becca R. (Yale University)
    Abstract: Low healthcare quality has been found to predict the development of several illnesses in older adults, while the evidence on dementia is still lacking. This study assesses whether and to what extent experiencing low healthcare quality can be associated with developing dementia in people 60-years-old and greater. Participants in the Health and Retirement Study (HRS), without dementia and 60-years-old and greater at baseline, were followed 2006 through 2019. Experiencing low healthcare quality was assessed at baseline through healthcare discrimination and dissatisfaction with healthcare services. The outcome, development of new cases of dementia, was determined through physician diagnosis or a cognition score compatible with dementia (assessed by the Telephone Interview for Cognitive Status). Cox regression is used to estimate the hazard ratio (HR) of dementia, adjusting for participants' demographic, health, and socioeconomic factors. Experiencing low healthcare quality is associated with increased dementia risk over 12 years (unadjusted HR: 1.68, 95% CI: 1.27 - 2.21, p-value
    Keywords: dementia, patient satisfaction, perceived discrimination, social determinants of health, healthcare quality, Alzheimer's Disease
    JEL: I11 I18 J14 J15 J18
    Date: 2024–03
  8. By: Chun Yee Wong (IUJ Research Institute, International University of Japan); Shugo Shinohara (Keio University)
    Abstract: This study investigates the effects of increased copayment on health behaviours among older people in Japan. Utilizing data from the Comprehensive Survey of Living Conditions (CSLC), our analysis focuses on the impacts on positive and negative health behaviours including having regular meals, balanced diet, regular sleep, doing exercise, smoking, and drinking alcohol. While augmented cost sharing is associated with increased positive health behaviours, its impact on negative behaviours is complex, with smoking rates declining but alcohol consumption showing a mild upward trend, particularly among highly educated individuals and males. Notably, higher educated individuals exhibit a greater propensity towards positive health behaviours. This research contributes to understanding the complex interplay between health insurance coverage and health behaviours among older adults, providing insights for policymakers aiming to promote healthy aging and mitigate adverse health outcomes resulting from policy reforms.
    Keywords: Copayment, Health Insurance, Health Behaviours, Older Adults, Japan
    JEL: I12 I15 I18
    Date: 2024–04
  9. By: Agnieszka Fihel (IC Migrations - Institut Convergences Migrations [Aubervilliers], UW - University of Warsaw); Anna Janicka (UW - University of Warsaw); Marek Okólski (UW - University of Warsaw)
    Abstract: Poland, traditionally a country of emigration, started to record a positive migration balance in recent years. However, thus far, no forecast has indicated the possibility of Poland's transition from a net sending to a net receiving regime. This study indicates the theoretical underpinnings of such a change and provides an international migration projection. To this end, we refer to the historical experiences of other European countries, more advanced in terms of the Demographic Transition (DT), Second Demographic Transition (SDT) and Migration Transition. We develop a deterministic migration projection of four types of flow (the in-and out-migration of nationals and foreign citizens) up until 2060, combined with the United Nations' Bayesian probabilistic models of fertility and mortality projections. The results show that Poland will evolve from having a net sending to having a net receiving status around 2030-2034. The combined effect of migration flows on population ageing will not be significant but, in the long run, when considered separately, the four types of flow will have non-negligible, though opposite, effects: the outflows will contribute to population rejuvenation, while the inflows will accelerate population ageing.
    Keywords: population ageing international migration migration projection demographic transition migration transition Poland, population ageing, international migration, migration projection, demographic transition, migration transition, Poland
    Date: 2023
  10. By: Jiayi Wen; Zixi Ye; Xuan Zhang
    Abstract: Justification bias, wherein retirees may report poorer health to rationalize their retirement, poses a major concern to the widely-used measure of self-assessed health in retirement studies. This paper introduces a novel method for testing the presence of this bias in the spirit of regression discontinuity. The underlying idea is that any sudden shift in self-assessed health immediately following retirement is more likely attributable to the bias. Our strategy is facilitated by a unique high-frequency data that offers monthly, in contrast to the typical biennial, information on employment, self-assessed health, and objective health conditions. Across a wider post-retirement time frame, we observe a decline in self-assessed health, potentially stemming from both justification bias and changes in actual health. However, this adverse effect diminishes with shorter intervals, indicating no evidence of such bias. Our method also validates a widely-used indirect testing approach.
    Date: 2024–03
  11. By: Gustafsson, Johan (Department of Economics, Umeå University); Sjögren, Tomas (Department of Economics, Umeå University)
    Abstract: This paper concerns the timing of taxation in an economy with trade unions. By using insights from the industrial organization literature, we show within the framework of an overlapping generations model where agents work in the first period of life and are retired in the second that trade unions can obtain an advantageous bargaining outcome vis-à-vis firms by delegating authority to a negotiator who (i) discounts the future at a higher rate than the union members, and (ii) treats the workers´ labor supply and saving decisions as given. In this context, the timing of taxation of first period labor income matters for wage formation and we show that the welfare can be improved by implementing an income-based pension for retired workers (i.e. a negative delayed income tax) when there is unemployment in equilibrium. We also outline when the welfare can be improved by implementing a positive delayed income tax. Finally, we show that if the trade union delegates authority to a negotiator who recognizes the workers´ labor supply and saving responses, the welfare cannot be improved by implementing a second period tax/pension.
    Keywords: Timing of taxation; labor market distortion; pensions
    JEL: H21 H55 J51
    Date: 2024–03–26
  12. By: Paul Beaudry; Katya Kartashova; Césaire Meh
    Abstract: Understanding factors that drive asset demand is central to explaining movements in long-term real interest rates. In this paper, we begin by documenting that much of the increase in the demand for assets in the US in the 30 years prior to Covid represented greater desire to hold assets by households of given age and income levels. For example, if we focus on the 55-64 age group, its wealth-to-income ratio increased by 45-55%, depending on whether housing is included or not. We then develop a model of asset demands which combines retirement motives and inter-temporal substitution motives to quantitatively explore different factors that may have contributed to such an increase. Our findings suggest that decreasing interest rates likely led to a substantial increase in demand for retirement wealth. We also explore some of the across group heterogeneity and show how social security may explain why the lowest income groups did not follow the general trend. Finally, we discuss macroeconomic implications of long-run asset demands that are a decreasing function of interest rates.
    JEL: E20 E40 G10
    Date: 2024–03
  13. By: Carole Bonnet (INED - Institut national d'études démographiques); Amélie Carrère (IPP - Institut des politiques publiques); Roméo Fontaine (INED - Institut national d'études démographiques); Agnès Gramain (BETA - Bureau d'Économie Théorique et Appliquée - AgroParisTech - UNISTRA - Université de Strasbourg - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Jérôme Wittwer (BPH - Bordeaux population health - UB - Université de Bordeaux - Institut de Santé Publique, d'Épidémiologie et de Développement (ISPED) - INSERM - Institut National de la Santé et de la Recherche Médicale)
    Abstract: Measuring the accessibility of care in nursing homes (Ehpads) is a key-element in the monitoring and evaluation of public policies for disabled elderly people. The relevance of such a measure is reinforced by the current context in many OECD countries, where the aging of the population is combined with the wish of public authorities to limit the creation of Ehpads new places. This note proposes a new family of measurement indicators, specifically designed to assess the consequences of French public policies, particularly in terms of territorial equity : to take into account of the potentially high out-of-pocket expenses and of the fact that regulation is largely decentralized at the departmental councils, these indicators aim to quantify the geographical and financial accessibility of Ehpad (AGFE), for a given individual, according to income level and location. The main indicator defined here can be adapted by modifying the target groups, or by integrating rules for prioritizing potential demand.
    Abstract: Mesurer l'accessibilité des prises en charge en établissement d'hébergement médicalisé (type Ehpad) est un élément important pour le pilotage et l'évaluation des politiques publiques de l'autonomie. L'intérêt d'une telle mesure est renforcé dans le contexte que connaissent de nombreux pays de l'OCDE, marqué par le vieillissement démographique mais la volonté des pouvoirs publics de restreindre le nombre de nouvelles places créées. Dans une perspective d'évaluation des conséquences de l'action publique, notamment en termes d'équité territoriale, la présente note propose une nouvelle famille d'indicateurs de mesure, adaptée aux politiques publiques françaises. Pour intégrer l'effet de restes-à-charge potentiellement élevés et de la décentralisation partielle de la régulation aux conseils départementaux, ils visent à quantifier l'accessibilité géographique et financière aux Ehpad (AGFE), pour un individu donné, en fonction de son niveau de revenu et de sa localisation. L'indicateur princeps défini ici peut être décliné en modifiant la population cible ou en intégrant des règles de priorisation des demandes potentielles.
    Keywords: Elderly, Nursing homes, Long-term care, Acces to care, Measure, Data, Personnes âgées, Perte d’autonomie, Ehpad, Accès aux soins, Indicateurs de mesure, Données
    Date: 2023–06
  14. By: Oriana De Saint Priest; Franciska Krings; Claudia Toma
    Abstract: Older employees often face discrimination and exclusion from work teams. In two scenario studies, we tested the impact of age diversity statements on the representation and inclusion of older employees in teams. In Study 1 (N= 304), participants were either exposed to a diversity statement or not, before selecting two teammates out of a list of four differing in age and gender for a project team. Then, we measured participants’ inclusive behavior towards a new older member joining this team. Age diversity statements were effective in boosting representation, but not inclusion. In Study 2 (N= 518), we further manipulated the content of the statement (diversity or diversity and inclusion) and the organizational motive (reputation or change). We replicated the effects of diversity statements on representation and additionally found an effect on inclusive behaviors, but only when the statement targeted diversity and inclusion while reflecting an organizational commitment to change.
    Date: 2024–03–10
  15. By: Tervola, Jussi; Iivonen, Saija; Hiilamo, Heikki
    Abstract: Social insurance and social assistance reflect fundamental principles of social policies. Social insurance benefits cover employed individuals against a social risk event such as unemployment or disability in exchange of paid contributions. Social assistance benefits, in turn, are designed typically to secure the minimum standard of living, regardless of past contribution. In this article we ask if the dualism is feasible to depict contemporary social benefits that cover traditional social risks: unemployment, childbirth, sickness, disability, and old age. A policy analysis of six European countries with extensive social security systems – Denmark, Estonia, Finland, Netherlands, Sweden, and United Kingdom – demonstrates that while traditional insurance benefits and assistance benefits still make up the majority of risk-based benefits, also different kinds of deviations from the pure forms are observed. Some countries provide hybrid benefits where past contribution affects benefit rate, but non-contributory minimum is guaranteed for all facing the risk. Some countries provide income-tested contributory benefits which is against the traditional insurance logic. Moreover, universal flat-rate benefits are found especially covering the risk of old age.
    Date: 2024–03–15

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