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on Economics of Ageing |
| By: | Diego Ascarza-Mendoza (School of Government and Public Transformation, Tecnológico de Monterrey); Alex Carrasco (Massachusetts Institute of Technology) |
| Abstract: | Why do two out of three Americans claim Social Security benefits before reaching their Full Retirement Age? Why do even sufficiently rich people claim early very often? This paper resolves this puzzling phenomenon by extending a standard incomplete markets life-cycle model to incorporate health dynamics and bequest motives. Relative to the existing literature, health plays a broader role, affecting not only medical expenses and mortality but also directly the marginal utility of consumption. This role of health is disciplined using microdata on consumption, assets, income, and health from the Health and Retirement Study (HRS) and the Consumption and Activities Mail Survey (CAMS). The calibrated model successfully replicates the fraction of early claimers. Counterfactual exercises show that health-dependent preferences and bequest motives are crucial for this result. The model’s success is explained by a novel channel that comes from the interaction between the negative effect of worsening health on the marginal utility of consumption, the downward health trend because of aging, and bequest motives. These two elements reduce the gains from delaying by (1) making individuals more impatient and (2) increasing the strength of bequest motives relative to future consumption. The results suggest that governments aiming to insure against longevity must consider the complementary interaction between individual incentives to insure against longevity and health risks. |
| Keywords: | Health, MarginalUtility, Frailty Index, Social Security, Annuities |
| JEL: | F13 D72 D83 C91 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:gnt:wpaper:22 |
| By: | Sona Badalyan |
| Abstract: | I study how delayed retirements reshape firms’ internal labor markets, leveraging a German reform that raised women’s early retirement age by at least three years. The reform increased retention of older women and reduced both internal promotions and external hiring of younger coworkers, with the greatest losses among middle-aged workers who were near to older workers on the career ladder. Spillovers are structured: promotion crowd-outs arise in thick internal labor markets with intense competition, while hiring declines are largest in thin external markets with high turnover costs. Crowd-out effects concentrate within jobcells, whereas coworkers in different jobcells can benefit when retained older workers possess specific human capital. Taken together, the evidence supports slot-constraint theories—augmented by firm-specific human-capital mechanisms |
| Keywords: | aging, internal labor markets, human capital, worker substitutability |
| JEL: | H55 J21 J23 J24 J26 J31 J63 M51 |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:cer:papers:wp810 |
| By: | Chun Yee Wong (IUJ Research Institute, International University of Japan); Shugo Shinohara (Keio University) |
| Abstract: | Increasing the cost share for older people can be a policy solution for sustaining healthcare schemes in aging societies. However, its effects on health behaviours remain elusive. This study investigates the Japanese health insurance reform, which increased the copayment rate from 10% to 20% for people aged 70-74 years in 2014. Using data from the Japanese Ministry of Health, Labor and Welfare between 2013 and 2016, our analysis examined the impacts of increased copayment on positive and negative health behaviours among older people, including having regular meals, doing moderate exercise, having regular sleep, smoking, and drinking alcohol. The study found that while augmented cost sharing is associated with increased positive health behaviours, its impact on negative behaviours is complex, with no significant impact on smoking rates but mild upward alcohol consumption. The subsample analyses further reveal heterogeneous effects of increased copayment, in which individuals with higher education levels or those living in big cities are more likely to respond to the policy change by increasing positive health behaivours. This research contributes to the understanding of the complex interplay between health insurance coverage and health behaviours among older adults, highlighting the importance of considering socio-demographic factors in promoting healthy aging. |
| Keywords: | Copayment, Health Insurance, Health Behaviours, Older Adults, Japan |
| JEL: | I12 I15 I18 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:iuj:wpaper:ems_2026_02 |
| By: | Nicole Black (Centre for Health Economics, Monash Business School, Monash University); Anthony Harris (Centre for Health Economics, Monash Business School, Monash University); David W. Johnston (Centre for Health Economics, Monash Business School, Monash University); Trong-Anh Trinh (Centre for Health Economics, Monash Business School, Monash University) |
| Abstract: | This paper examines how the composition of financial resources relates to financial hardship and financial satisfaction among retired households. Using 23 waves of a nationally representative Australian panel, we distinguish between government pensions, private income, liquid financial assets, housing wealth, and debt. In fixed-effects models that exploit within-individual changes over time, liquid financial assets are strongly associated with lower financial hardship and higher financial satisfaction, while other forms of wealth show little independent association. We additionally examine responses to health shocks and find that liquid assets significantly attenuate their adverse financial effects, providing direct evidence of a buffering role. These results indicate that retirees with similar total wealth may experience different financial outcomes depending on portfolio composition, and suggest that adequacy assessments based on aggregate wealth or income replacement rates alone may overlook an important source of financial vulnerability. |
| Keywords: | Retirement adequacy, Financial resilience, Financial hardship, Liquidity, Health shocks |
| JEL: | D14 H55 I31 J14 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:mhe:chemon:2026-01 |
| By: | Soria, Chris; Feehan, Dennis |
| Abstract: | Personal networks influence health and mortality at the individual level, but less is known about how population-scale social network structure relates to mortality. This study examines how US county-level social network structure relates to mortality disparities. Using measures from 21 billion Facebook friendships, we investigate how two structural features of population social networks – cohesiveness and diversity – are associated with age-standardized and age-specific mortality rates. Bivariate results show that measures of social network structure rival smoking rates, median income, and educational attainment in their association with mortality rates. Social network structure remains predictive of mortality even after controlling for traditional measures like socioeconomic status and rural/urban classification. Network diversity is associated with lower mortality in both bivariate and multivariate analyses. Network clustering is associated with higher mortality bivariately, but this association reverses after controlling for county-level demographic and socioeconomic factors, revealing a protective effect masked by confounding. Age-stratified analyses further complicate this picture, showing that clustering predicts lower mortality among adults aged 15-64 but higher mortality among those 70 and older. These findings highlight social network structure as an important dimension of place-based health disparities, one not fully captured by conventional measures of socioeconomic composition or spatial segregation. |
| Date: | 2026–01–21 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:kvmx6_v3 |
| By: | Licker, Luisa V.; Guthmuller, Sophie; Wübker, Ansgar |
| Abstract: | Dementia is associated with an increasing need for care, which is often provided by informal carers. This may have an impact on their behaviour in the labour market. This study analyses the impact of dementia severity on informal care, labour market participation and working hours of informal carers. We use data from the multinational RightTimePlaceCare (RTPC) study, which covers eight European countries and uniquely links detailed information on people with dementia and their primary informal carers. Using descriptive statistics and multivariate regression models, we analyse the relationships between the severity of dementia, the intensity of care and labour market outcomes, taking into account the endogeneity of care intensity through an instrumental variable approach. Our results show that higher dementia severity significantly increases the intensity of informal care and substantially reduces both labour market participation and working hours of informal carers. These findings highlight the economic consequences of dementia care and underscore the importance of considering labour market impacts when assessing informal dementia care. |
| Abstract: | Demenz geht mit einem steigenden Pflegebedarf einher, der häufig von informellen Pflegekräften gedeckt wird. Dies kann sich auf ihr Verhalten auf dem Arbeitsmarkt auswirken. Diese Studie analysiert die Auswirkungen des Schweregrads der Demenz auf die informelle Pflege, die Erwerbsbeteiligung und die Arbeitszeiten informeller Pflegekräfte. Wir verwenden Daten aus der multinationalen RightTimePlaceCare (RTPC)-Studie, die acht europäische Länder umfasst und detaillierte Informationen über Menschen mit Demenz und ihre primären informellen Pflegekräfte auf einzigartige Weise miteinander verknüpft. Mithilfe deskriptiver Statistiken und multivariater Regressionsmodelle analysieren wir die Zusammenhänge zwischen dem Schweregrad der Demenz, der Intensität der Pflege und den Arbeitsmarktergebnissen, wobei wir die Endogenität der Pflegeintensität durch einen Instrumentvariablenansatz berücksichtigen. Unsere Ergebnisse zeigen, dass ein höherer Schweregrad der Demenz die Intensität der informellen Pflege deutlich erhöht und sowohl die Erwerbsbeteiligung als auch die Arbeitszeit der informellen Pflegepersonen erheblich verringert. Diese Ergebnisse verdeutlichen die wirtschaftlichen Folgen der Demenzpflege und unterstreichen, wie wichtig es ist, bei der Bewertung der informellen Demenzpflege die Auswirkungen auf den Arbeitsmarkt zu berücksichtigen. |
| Keywords: | Dementia, Informal caregiving, Labour market participation, Labour market hours |
| JEL: | J14 J22 I11 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:rwirep:335897 |
| By: | Alexander Ahammer; Lea-Karla Matic |
| Abstract: | Medical spending is highly concentrated at the end of life and varies widely across patients, raising a first-order welfare question about whether marginal end-of-life spending reflects waste or generates meaningful benefits. Using Austrian administrative data, we document that endof- life spending has grown markedly over time and remains highly dispersed even conditional on diagnosis, with predicted mortality explaining only a small share of the variation. We then study a largely underexplored margin: spillovers onto surviving spouses. Event study estimates show large and persistent changes in spouses’ employment and healthcare use around spousal death. However, these dynamics are essentially invariant to the decedent’s end-of-life spending intensity, a finding that is robust to different measures of spending intensity and to an instrumental variables design exploiting provider-level practice variation. Together, these results are consistent with an important role for inefficiencies in end-of-life care. |
| Keywords: | End-of-life, healthcare expenditure, efficiency, health shock, labor supply |
| JEL: | I10 I11 I12 I14 I18 J12 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:jku:econwp:2026-02 |
| By: | Bardóczy, Bence (Federal Reserve Board); Savoia, Ettore (Research Department, Central Bank of Sweden); Vel´asquez-Giraldo, Mateo (Federal Reserve Board) |
| Abstract: | We study the transmission and distributional effects of monetary policy in an environment where consumption-saving choices reflect both precautionary motives and life-cycle considerations. Age emerges as a key state variable linking multiple dimensions of heterogeneity: young households have low wealth, high marginal propensities to consume, and strongly procyclical hours. In a quantitative model matching these facts, monetary policy operates primarily by stimulating investment and boosting labor demand for young workers. Wealthy retirees are affected through asset repricing and lower future returns, but the consumption and welfare effects for most retirees are small because they hold little financial wealth. |
| Keywords: | HANK; Heterogeneous Agents; Life-Cycle Dynamics; Monetary Policy; Redistribution. |
| JEL: | D31 D91 E21 E32 E52 |
| Date: | 2026–01–01 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:rbnkwp:0461 |