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on Economics of Ageing |
| By: | Fella, Giulio; Holm, Martin Blomhoff; Pugh, Thomas M. |
| Abstract: | We use administrative data for Norway to estimate an incomplete-market life-cycle model of retired singles and couples with a bequest motive, health-dependent utility, and uncertain longevity and health. We allow the parameters of the bequest utility to differ between households with and without offspring. Our estimates imply a very strong utility of residual wealth (bequest motive), in line with the estimates by Lockwood (2018). The bequest motive accounts for approximately three-quarters of aggregate wealth at age 85. More surprisingly, we estimate similar utility of residual wealth for households with and without offspring. We interpret this as, prima facie, evidence that the utility of residual wealth represents forces beyond an altruistic bequest motive. |
| Keywords: | Retirement; Savings |
| JEL: | D11 D12 D14 E21 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19233 |
| By: | Miles, David; Sefton, James |
| Abstract: | We use stochastic simulations to analyse the probability distribution of outcomes for the UK University pension scheme (the USS) in the light of conflicting claims about its sustainability. We use the results to draw wider conclusions about the nature of defined benefit (DB) pension schemes and whether they bring benefits to members based on risk sharing. We find that a substantial investment in riskier assets (equities) makes the average outcome one in which the scheme is comfortably able to pay accrued benefits. But the risk of having far fewer funds than needed to pay existing pension promises is significant and the chances of large deficits is substantial. The ambiguity about how pension fund surpluses or deficits would be allocated between scheme members and the scheme sponsor (for the USS that is Universities) means that agreement on the optimal portfolio allocation for the scheme's funds is not likely. Among scheme members of different ages and different attitudes towards risk agreement on what are acceptable trade-offs between risk and return on assets is unlikely. We contrast this with the position for defined contribution pensions. |
| Keywords: | Pensions |
| JEL: | G11 G50 G22 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19254 |
| By: | Kwon, Alexander; Maliar, Lilia |
| Abstract: | We demonstrate that machine learning substantially improves predictions of individual decisions about retirement and Social Security (SS) claims. When predicting the number of people receiving SS, we achieve an error of less than 1%, while the benchmark model employed by the Social Security Administration (SSA) results in a greater than 4% error, and in forecasting SS claiming decisions, we attain an error of 0.2%, while the benchmark exceeding 2%. Based on averages, we show that a 3% difference in prediction amounts to 39.6 billion dollars annually. The set of important variables selected by our model significantly differs from that of the SSA model. We use Shapley values to evaluate the non-linear contributions of the selected variables to predictive outcomes. |
| Keywords: | retirement and Social Security |
| JEL: | C53 H55 J14 J26 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19198 |
| By: | Coimbra, Nuno; Gomes, Francisco; Michaelides, Alexander; Shen, Jialu |
| Abstract: | We show that incorporating defined benefit pension funds in an incomplete markets asset pricing model improves its ability to match the historical equity premium and riskless rate and has important risk sharing implications. We document the importance of the pension fund's size and asset demands, and a new risk channel arising from fluctuations in the fund's returns. We use our calibrated model to study the implications of a shift to an economy with defined contribution plans. The new steady-state is characterized by a higher riskless rate and a lower equity premium. Consumption volatility increases for retirees but decreases for workers. |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19401 |
| By: | Melissa McInerney; Lorena Moreno; Jennifer M. Mellor |
| Abstract: | In this paper, we compare supplemental Medicare insurance coverage among people with probable dementia (PWPD) and matched controls, before and after onset. This retrospective secondary data analysis of insurance coverage changes using propensity score weights and the 2000-2016 Health and Retirement Study (HRS). The sample consists of 3, 001 Medicare-enrolled adults age 65 and older with PWPD, and 14, 055 controls. Probable dementia is assessed with the Langa-Weir approach and interviewer assessments for proxy interviews. Four years before onset, PWPD become more likely to have Medicare without supplemental coverage (2.97 percentage points; p=0.0016) than matched controls. This reflects the net effect of PWPD being less likely to have Medicare Advantage or traditional Medicare with supplemental coverage, and more likely to have Medicaid. Two years before onset, PWPD were more likely to be Medicaid-eligible (4.95 percentage points, p |
| JEL: | I1 I13 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35606 |
| By: | Andrew Binning; Murat Özbilgin; Christie Smith; Vu, Hanna (The Treasury) |
| Abstract: | In this paper we use the Treasury’s overlapping generations (OLG) model to describe the macroeconomic, fiscal, and distributional effects that arise when New Zealand’s superannuation scheme is amended to moderate increases in superannuation expenditure. In this Note, we focus specifically on changing the age of eligibility from 65 years of age to higher ages. We also consider automatic rules for adjusting the age at which people become eligible for superannuation. We illustrate the macroeconomic effects of these changes for income, capital accumulation and labour supply, and consider the fiscal implications for expenditure and revenue. Lastly, we describe the welfare (wellbeing) implications of these alternative pension policies for people of five different income types, encompassing low-, median-, and three higher-income levels. This welfare analysis allows us to trace out how such policy changes would affect people born before and after any policy change, including those born in the more distant future. Our analysis shows that policy changes to reduce the fiscal costs of NZS would increase aggregate labour supply, capital accumulation, and income by moderating the tax increases required for fiscal sustainability and reducing the distortionary effects of taxes on private behaviour. We also show that the distributional outcomes of these policies are fairly complex: generations several decades ahead would benefit but some earlier generations and some people with lower incomes would be better off under a baseline fiscal strategy in which additional taxes fund the current NZS scheme. The magnitude and timing of policy changes also affects the costs and benefits of such policy change. We show that pre-announcing policy changes and spreading changes out over time reduces the burden felt by people from these changes because they have more time to adapt their lifetime behaviour, including consumption, saving, and labour supply. Our analysis implies that the age of eligibility would need to be raised to very high levels to stabilise pension expenditure as a share of gross domestic product, raising the possibility that other policy adjustments might be needed to support changes in the age of eligibility. Additional policy changes would also be required to meet the expenditure pressures affecting health expenditure. Governments have a range of potential tools available to address long-term fiscal pressures, including means-testing of pension eligibility to target support, changes to the magnitude of pensions, changes to other spending programmes, the mix of taxes used to raise revenue, and policies that influence public productivity, economic growth and labour force participation. This Analytical Note and the other background papers released alongside the LTFS contribute to the evidence base underpinning public discussion of New Zealand’s long-term fiscal sustainability. |
| JEL: | H3 H55 |
| Date: | 2026–07–30 |
| URL: | https://d.repec.org/n?u=RePEc:nzt:nztans:an26/05 |
| By: | Pedro Bordalo; Nicola Gennaioli; Matthew O'Brien; Andrei Shleifer |
| Abstract: | The US Health and Retirement Study collects data on participants’ recall fluency (RF), their ability to recall words from a list, a standard measure of memory used by psychologists. Controlling for multiple demographic characteristics as well as IQ, people with a higher RF are more optimistic about stock returns, the price of their homes, and their life expectancy. We derive the predictions of a standard memory model and find that, consistent with them, the beliefs of higher RF people about each target domain are more sensitive to cues, to experiences in that domain, but also to irrelevant experiences in other domains, especially those similar to the target. These effects, in turn, carry to investment and retirement choices. RF emerges as an economically relevant personal trait. |
| JEL: | E03 E70 G41 G5 G51 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35600 |
| By: | Victor Andrade Medeiros dos Santos (Universidade Federal da Paraíba, PPGE/UFPB); Wallace Patrick Santos Farias de Souza (Universidade Federal da Paraíba, PPGE/UFPB); Hudson Gutiery Pinheiro de Medeiros (Universidade Federal do Rio Grande do Norte, PPECO-UFRN) |
| Abstract: | This study analyzes the impact of Constitutional Amendment No. 103/2019 on the sustainability of municipal Public-Sector Pension Schemes (RPPS) in Brazil, focusing on actuarial deficits. Using the deconstitutionalization of pension rules as an identification mechanism, the study exploits variation in municipal responses after the transfer of legislative autonomy to subnational governments. Employing the staggered Difference-in-Differences (staggered DiD) approach, the results indicate a statistically significant reduction in actuarial deficits, ranging from 19.73% to 23.32%. The findings suggest that long-term sustainability depends on effective local governance, administrative capacity, and sound management of pension assets and institutional arrangements across different municipal contexts. |
| Keywords: | Pension Reform, RPPS, Difference-in-Differences, Deconstitutionalization, Actuarial Sustainability |
| JEL: | H55 H72 H75 C33 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ris:nereus:023544 |
| By: | Vrinda Mittal |
| Abstract: | I study investments of U.S. public pensions in private equity (PE), and trace them to ultimate micro assets—target firms which PE funds invest in, using micro-data on private investments combined with confidential U.S. Census data. I show that more severely underfunded public pensions receive lower average PE returns, and match with smaller GPs on average, than less underfunded pensions. Consistent with matching and returns, firms financed by most underfunded public pensions and smallest PE funds face labor productivity decreases. I introduce a novel instrument—public unionization—in support of underfunding positions driving selection into funds. Lastly, I evaluate alternate mechanisms. |
| Keywords: | public pensions, underfunding, private equity, productivity |
| JEL: | G23 G24 H55 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:cen:wpaper:26-47 |
| By: | Thibault, Emmanuel; Pestieau, Pierre |
| JEL: | J14 J11 D15 E22 |
| Date: | 2026–08–20 |
| URL: | https://d.repec.org/n?u=RePEc:tse:wpaper:132039 |
| By: | Andrew Binning; Christie Smith; Vu, Hanna (The Treasury) |
| Abstract: | In this paper, we use the Treasury’s overlapping generations (OLG) model to describe the macroeconomic, fiscal, and distributional effects of three policy reforms that reduce superannuation expenditure pressures: i) changing NZS indexation methods, ii) adjusting the pension replacement rate, and iii) combining changes to indexation with an increase in the age of eligibility. The scenarios presented are hypothetical analytical exercises designed to illustrate the mechanisms at play within the model rather than represent specific policy proposals. The analysis highlights the macroeconomic effects of these reforms on aggregate income, capital accumulation, and labour supply, as well as the fiscal implications for government expenditure and revenue. In our OLG model, reforms aimed at reducing the fiscal costs of superannuation would enhance aggregate labour supply, capital accumulation, and income by alleviating tax distortions. The OLG framework also enables us to examine how alternative strategies affect people with different lifetime income profiles and those born in different years. The results illustrate that different households respond differently to the policies considered, and that the strategies have different consequences for wellbeing, across generations and for people with different income profiles. The distributional impacts are complex. While future generations stand to benefit from lower tax burdens and stronger transitional economic growth, some current generations and lower-income individuals would be made worse off compared to a Baseline scenario where additional taxes fund the existing NZS scheme. The scenarios examined in this paper consider only one dimension of the broader set of policy choices discussed in the LTFS. Governments have a range of potential tools available to address long-term fiscal pressures, including changes to spending programmes, eligibility settings, the mix of taxes used to raise revenue, and policies that influence economic growth and labour force participation. The purpose of this Note is to provide technical insight into how alternative superannuation policies can be used to address some of the fiscal pressures that are expected to arise in future decades. |
| JEL: | H24 H3 |
| Date: | 2026–07–30 |
| URL: | https://d.repec.org/n?u=RePEc:nzt:nztans:an26/06 |
| By: | Mette Ejrnaes (Department of Economics, University of Copenhagen); Thomas H. Joergensen (Department of Economics, University of Copenhagen); Franziska Valder (Department of Economics, University of Copenhagen) |
| Abstract: | Understanding how households use family planning to navigate constraints is important for policy design. We exploit a large Danish retirement reform that affected intergenerational time transfers to study how family planning responds to changes in time constraint tightness. Using administrative data on the universe of abortions and prescriptions for planned and emergency oral contraception, we show that alleviating time constraints reduces both abortions and contraceptive use and thereby shifts behavior toward childbirth. Our results highlight that time constraints shape responses to especially unplanned pregnancies and that policies easing household constraints may influence abortion behavior and family planning. |
| Keywords: | Time constraints, Unintended pregnancies, Abortion, Contraceptives, Childbirth, Childcare, Retirement Reform. |
| JEL: | J13 I38 D64 |
| Date: | 2026–08–07 |
| URL: | https://d.repec.org/n?u=RePEc:kud:kucebi:2616 |
| By: | Peter Haan; Julia Schmieder; Izabela Wnuk-Soares |
| Abstract: | We study how immigration affects prices through changes in labor supply. Using policy-driven increases in immigration to Germany and administrative data covering the universe of nursing homes, we find that one additional foreign-born woman per 100 residents reduces nursing-home care prices by 2.6 percent. The price effects are concentrated in more competitive markets. Examining potential mechanisms, we find that immigration lowers labor costs as nursing homes shift toward lower-paid foreign-born workers. We find no evidence of declines in inspection-based measures of quality or of scale effects. Finally, immigration increases the use of informal care, potentially strengthening competitive pressure from the broader care market. |
| Keywords: | Immigration, labor supply, prices, nursing homes |
| JEL: | J61 F22 J30 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwwpp:dp2177 |
| By: | Weni Susanti (Universitas Tridinanti, Sumatra Selatan, 30129, Sumatera Sealatan, Indonesia Author-2-Name: Kamaludin Author-2-Workplace-Name: Doktor Manajemen, Universitas Bengkulu, 38371, Bengkulu, Indonesia Author-3-Name: Berto Usman Author-3-Workplace-Name: Doktor Manajemen, Universitas Bengkulu, 38371, Bengkulu, Indonesia Author-4-Name: M.Bima Eka Putra Author-4-Workplace-Name: Doktor Manajemen, Universitas Bengkulu, 38371, Bengkulu, Indonesia Author-5-Name: Agus Riyadi Author-5-Workplace-Name: Doktor Manajemen, Universitas Bengkulu, 38371, Bengkulu, Indonesia Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:) |
| Abstract: | " Objective - To explore personal financial management practices, financial decision-making, and the gap between economic independence and financial capability among career women in Bengkulu City. Methodology/Technique - A qualitative case study approach utilizing semi-structured interviews with 15 career women from government institutions, state-owned enterprises, and banking sectors. Data were analyzed using thematic analysis based on the Miles and Huberman interactive model. Findings - The study identified five major themes: budgeting practices, consumption orientation, debt reliance, saving and investment behavior, and long-term financial planning. Many respondents demonstrated limited financial capability, characterized by weak budgeting discipline, consumption-oriented spending, inadequate savings, and limited retirement planning, revealing that economic independence does not automatically translate into effective financial management. Novelty - The integration of Gender Role Theory and the Financial Capability Framework to explain how socio-cultural expectations and financial competence jointly shape the financial decision-making and sustainable well-being of career women. Type of Paper - Empirical" |
| Keywords: | Career Women, Financial Capability, Financial Literacy, Financial Decision-Making, Personal Financial Management. |
| JEL: | G51 J16 D14 |
| Date: | 2026–06–30 |
| URL: | https://d.repec.org/n?u=RePEc:gtr:gatrjs:gjbssr677 |
| By: | Cruz, Marcio; Milet, Emmanuel; Olarreaga, Marcelo; Solleder, Jean-Marc |
| Abstract: | We estimate the mobility costs of workers across sectors and regions in a large sample of developing countries. We develop a new methodology that uses cross-sectional data only. This is motivated by panel data being typically unavailable for developing countries. Our main identifying assumption for the labour mobility costs is that the age of the worker, or rather the time to retirement, is an important determinant of whether it is profitable to change jobs. We estimate the median sector mobility cost to be 0.77 times workers’ annual labour income, the median region mobility cost to be 0.49 times workers’ annual income, and the median cost of moving both sector and region to be 0.98 times workers’ annual income. Women face higher mobility costs. The median welfare gains from removing sector, region, and sector/region mobility costs are estimated at 3, 2, and 5 per cent of real annual wages, respectively. |
| JEL: | E24 F13 F16 O15 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19209 |
| By: | Cevat Giray Aksoy; Aya Aboulhosn; Berkay Ozcan |
| Abstract: | Research and policy debates on population aging typically assume that immigration matters only through immigrants' own fertility and its impact on total population size, ignoring effects on natives' fertility. We study this margin in the context of the large inflow of Syrian refugees into Türkiye after 2011. Using an instrumental-variables strategy, we provide evidence that greater local exposure to refugees increases native fertility. Drawing on complete birth histories from the Demographic and Health Surveys, we find that the response operates primarily through earlier entry into motherhood and is concentrated among younger women. The result holds across three independent datasets, including administrative birth registers, and is mirrored in women's stated ideal number of children. Examining potential mechanisms, we find the evidence most consistent with improved household economic security and find no support for channels operating through housing costs or the use of paid childcare. |
| Keywords: | forced migration; fertility; refugees |
| JEL: | J13 R23 F22 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:crm:wpaper:26212 |