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on Economics of Ageing |
| By: | Gutierrez, Bryan; Ivashina, Victoria; Salomao, Juliana |
| Abstract: | Are defined contribution (DC) pension funds' capital flows sensitive to performance? We examine pressures from individual account holders who can switch their pension managers. Using novel data on retirement accounts for nearly 10 million individuals, we analyze switching behavior based on the plan’s risk profile. Switching across managers within the same pension product is not uncommon, and the tendency to change managers rises over time. Capital flows are sensitive to and increase with fund performance. This sensitivity creates pressure on managers, shaping their incentives and portfolio decisions. A quasi-exogenous increase in outflows leads managers to shift toward higher-yielding bond holdings. |
| Keywords: | Pension funds; Reach-for-yield |
| JEL: | J32 D14 G2 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19286 |
| By: | Peter A. Diamond |
| Abstract: | Public pension systems are long-term social contracts operating under persistent economic, demographic, and political uncertainty. Periods of turbulence, marked by financial shocks, changes in longevity, and shifting labour markets, test the capacity of pension institutions to adapt while maintaining adequacy, equity, and legitimacy. Building on earlier joint work on pension economics and reform with Nicholas Barr, this chapter analyses the role of automatic and semi-automatic adjustment mechanisms in public pension design. Drawing on comparative experience from Sweden, Canada, and the United States, we examine mechanisms for maintaining financial balance, the incorporation of life expectancy into retirement age and benefit design, and the accumulation and drawdown phases of defined contribution pensions. We argue that well-designed automatic mechanisms can discipline political decision-making and improve resilience, but only if they are proportionate, transparent, and attentive to distributional and intergenerational consequences. In turbulent times, good pension design does not eliminate the need for political choice; rather, it structures that choice so that adjustment can occur without repeated crises. |
| Keywords: | national pensions, automatic indexing |
| JEL: | H55 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12951 |
| By: | Elsa Perdrix; Axel H. Börsch-Supan; Johannes Geyer; Peter Haan; Sami Louahlia |
| Abstract: | Germany experiences an increase in LTC recipients, due to population ageing but also to reforms which made LTC benefits easier accessible for individuals with cognitive impairments. Previous studies documented the cost of long-term care, and how it evolved. However, less is known about the specific case of elderly people suffering from cognitive impairment. Thus, we measure the economic costs of cognitive impairment, which include extensive medical, nursing care and at-home long-term care. We use the SHARE, the Survey on Health, Ageing and Retirement in Europe, Wave 9. We observe 4% of elderly people living at home with severe cognitive impairment (SCI) (Langa et al. (2017) definition). These individuals are 30% more likely to receive any care, and obtain on average 6 more hours of formal care and 6 more hours of informal care per week. The main driver is not the cognitive impairment per-se but the limitation in activities of daily living (ADLs) which SCI leads to. Thus, once controlling for ADLs, SCI does not explain any additional probability to use care. However, because people with SCI are more likely to have ADLs, the annual cost of their care is estimated to 10, 000 euros per year per individual on average. |
| JEL: | I1 J14 P46 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35469 |
| By: | Burkhard Heer; Mark Trede |
| Abstract: | We develop a medium-scale overlapping-generations model with endogenous labour supply and skill premium to study optimal income redistribution using progressive labour income taxes and pensions. The model is calibrated to the four countries USA, Great Britain, Italy and Germany which differ substantially in their tax and pension systems, demographics, and skill shares among workers. Optimal pension benefits are proportional to lifetime contributions in all four countries, while the optimal degree of income progressivity varies systematically with country characteristics such as the size of the social security system, demographics or the skill share in the labour force. Optimal income taxes should be more progressive in the United States and Great Britain and much less progressive in the continental countries, Italy and Germany. Population ageing further reduces the optimal extent of income redistribution. |
| Keywords: | inequality, income distribution, skill premium, overlapping generations, social security, progressive taxation, pension schedule |
| JEL: | C68 D31 H21 H24 H55 J11 J26 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12938 |
| By: | Dong-Han Shin (Korea Institute for Industrial Economics and Trade) |
| Abstract: | Rapid population aging has increased social demand for a stronger care food industry. Beyond the immediate purpose of putting healthy food in front of older people who can no longer eat normally, whether because digestive function has declined or because a spouse has died, some argue that spreading care food to healthy older adults as a preventive measure would also benefit the long-term soundness of National Health Insurance and Long-Term Care Insurance finances. Social demand is rising, yet for several reasons Korea’s care food industry cannot be expected to achieve meaningful qualitative growth if it is left to the market alone.<p> The core problems are a fragile revenue base and structural constraints. On the surface, mid-sized and larger firms account for a substantial share of the companies selling care food, but market uncertainty has delayed their active participation. The firms that actually depend on care food for most of their revenue are overwhelmingly small and medium-sized enterprises, and the number posting operating losses has been trending upward. Two structural causes stand out: a persistent gap between manufacturing costs and the unit prices public institutions pay, and awareness so low that 66.4 percent of consumers surveyed in 2020 had never heard of care food. Both erode profitability across the industry, and neither is likely to resolve itself through market forces, which makes appropriate government intervention necessary.<p> The policy agenda divides into short-term and longer-term tasks. In the short term, consumer awareness must be raised through expert endorsement, media exposure, and wider opportunities to try the products, and the picture of the market itself, which currently rests on assumption-based estimates, must be sharpened. Over the medium to long term, infrastructure needs to be put in place so that frozen and partially prepared care food can be used inside care facilities, the Long-Term Care Insurance fee schedule needs adjustment, and upgrading the industry through AI and age tech will be important. |
| Keywords: | care food; population aging; senior-friendly industry; senior-friendly food certification; institutional food service |
| Date: | 2026–07–31 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kietrp:023559 |
| By: | Joan Costa-i-Font; Sergi Jiménez-Martín; Cristina Vilaplana-Prieto |
| Abstract: | We estimate the health and wellbeing effects of subsidized access to long-term care (LTC). Our analysis exploits the staggered implementation of Spain’s 2007 System of Autonomy and Care for Dependent People (SAAD), which expanded publicly funded and universal LTC subsidies and supports, as well as its subsequent reform. Using two decades worth of administrative and survey data and leveraging exogenous regional and individual-level variation in program exposure, we find that access to SAAD benefits reduces the care receiver’s depressive symptoms by about 1 percentage point, increases its survival probability by 2.6–3 percentage points, and raises its life satisfaction by 0.24–0.50 scale points. Cost-effectiveness estimates indicate that the implied cost per quality-adjusted life year (QALY) gained lies below commonly accepted efficiency thresholds for public health spending in Europe. These findings document sizeable health returns and efficiency gains from publicly subsidized LTC provision |
| Keywords: | long-term care subsidies, long-term care supports, old age care, Spain, mortality, cost per QALY, survival, mental health, and life satisfaction. |
| JEL: | I18 J14 J16 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12943 |
| By: | Yvonne Krabbe-Alkemade; France Portrait; Maarten Lindeboom; Marjolein Broese van Groenou; Hendrika J Luijen; Dorly Deegdijk |
| Abstract: | This study examines the causal effect of labor market restrictions faced by women in early adulthood on later-life cognitive functioning. To identify this effect, we exploit an exogenous policy change in the Netherlands that removed restrictions on married women's access to paid employment in 1957. Our study draws on data from the Longitudinal Aging Study Amsterdam, an ongoing cohort study of older individuals. We focus on individuals aged 75 and older born between 1928 and 1947. We first examine how work restrictions in early adulthood shape lifetime employment. Next, we assess how these work restrictions affect women’s later-life cognitive outcomes exploiting an exogenous change in labor restriction laws and complement this with an instrumental variables approach. The estimation results indicate that restricted access to paid employment for women in early adulthood reduced labor force participation and occupational prestige over the life course. These reduced labor market opportunities, in turn, led to poorer cognitive functioning after age 75. We also find some suggestive evidence that these restrictions resulted in faster cognitive decline. Taken together, our findings indicate that restrictions on women’s access to paid employment adversely affect cognitive functioning, thereby contributing to cognitive disparities between men and women in later life. More broadly, they highlight the long-term cognitive benefits of sustained labor market engagement and cognitively stimulating work, with potential implications for dementia prevention. |
| Keywords: | Cognitive functioning at older age, dementia, access to paid employment, gender disparities |
| JEL: | J16 J19 J24 |
| Date: | 2026–09–03 |
| URL: | https://d.repec.org/n?u=RePEc:mhe:chemon:paper_1788391888415_642 |
| By: | KC, Samir |
| Abstract: | Population and human-capital pathways are central to global environmental change research, yet most widely used demographic projections end in 2100. This creates a time-horizon problem for slow-moving environmental processes, including sea-level rise, land-use change, long-lived infrastructure, food-system transformation and adaptation across generations. We extend Shared Socioeconomic Pathways population and human-capital scenarios to 2300 and examine how peak population gives way to long-run demographic decline, aging and regional redistribution. In the middle-of-the-road pathway, the global population declines to about 4.2 billion by 2300. In the sustainability pathway, it approaches 1 billion. These are not extinction scenarios, but they describe a profound change in the social and demographic setting in which environmental demand, exposure, adaptation and policy operate. The results show that the post-2100 period cannot be treated as a simple continuation of twentieth-century population growth. A smaller, older and more educated world may reduce some overall pressures while intensifying others, especially around labor, care, migration and uneven regional change. Long-run environmental analysis, therefore, needs population pathways that extend beyond 2100 and include not only population size, but also age, education, spatial distribution and demographic momentum. |
| Date: | 2026–08–02 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:sm4n8_v1 |
| By: | Anna Marenzi (Ca’ Foscari University of Venice); Michele Zanette (Ca’ Foscari University of Venice); Francesca Zantomio (Ca’ Foscari University of Venice) |
| Abstract: | Population ageing is increasing pressure on local welfare systems, but the capacity of municipalities to finance and provide services for older people differs substantially across territories. This paper studies municipal expenditure on older people in Italy, focusing on the large territorial disparities observed across municipalities and regions. Using municipality-level data for 2019, before the disruption caused by the COVID-19 pandemic, the paper investigates how cross-sectional differences in per capita expenditure are associated with indicators of local needs, fiscal resources and local policy orientation. We develop a parsimonious analytical framework linking municipal expenditure to potential financial needs, local policy orientation, and fiscal resources and co-financing. Under an explicit normalization, the framework allows us to construct model-based indicators of potential financial needs and their implied coverage by predicted municipal expenditure. The results document a marked territorial divide in spending on older people and suggest that municipal expenditure covers only a limited share of estimated needs and that unequal fiscal resources contribute substantially to territorial disparities. The findings highlight the importance of local fiscal capacity and intergovernmental financing arrangements in shaping access to local services for older people across territories. |
| Keywords: | older people; long-term care; municipal expenditure; territorial inequality; fiscal capacity; Italy |
| JEL: | H72 H75 I38 J14 R58 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ven:wpaper:2026:23 |
| By: | Horan, Rick; Reeling, Carson; Shortle, James |
| Keywords: | Environmental Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404466 |
| By: | Joshua Coven; Sebastian Golder; Arpit Gupta; Abdoulaye Ndiaye |
| Abstract: | Low property taxes amplify lock-in among elderly homeowners, limiting housing access for young families. Raising them reallocates housing toward the young through two channels: capitalization into lower prices reduces required downpayments for financially constrained buyers, a form of embedded leverage, while higher tax obligations raise holding costs for older owners. In our overlapping generations model, raising California’s property taxes to Texas levels increases young homeownership while decreasing elderly homeownership. Removing step-up basis also lowers elderly homeownership, suggesting their tenure is sustained by bequest tax advantages. The tax treatment of housing shapes housing allocation across generations. |
| JEL: | H24 H71 J11 R21 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35587 |
| By: | Hamid Noghanibehambari; Jason Fletcher |
| Abstract: | This paper examines the long-term effects of early-life exposure to county health departments (CHDs), a public health initiative aimed at providing affordable healthcare access to disadvantaged and underserved areas during the early decades of the 20th century, on later-life longevity. We employ Social Security Administration death records linked with the 1940 census and implement a difference-in-differences estimation strategy to compare the longevity of individuals exposed at different ages to the county-specific year of CHD establishment. We find that exposure to a CHD opening in the county of birth during fetal development and early years of life is associated with a 1-4-month increase in longevity. We observe considerable heterogeneity in the results, such that the effects are more concentrated among non-white individuals and individuals with lower-educated parents. Contemporaneous fertility and infant mortality data suggest reductions in infant mortality rates and increases in birth rates following CHD openings. Additionally, we find significant improvements in educational attainment, socioeconomic status, and income in early adulthood. We argue that enhancements in the fetal environment, improved fetal survival, and better early life health capital resulting from CHD exposure contribute to improvements in human capital during adulthood, with potential implications for later-life longevity. |
| JEL: | I1 I18 J14 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35533 |
| By: | Ha Minh Nguyen |
| Abstract: | How do demographic trends shape the adoption of AI and automation technologies? This paper provides the first large-scale cross-country firm-level test of the demographic–automation hypothesis using World Bank Enterprise Surveys data covering 89, 380 firms across 144 countries from 2022 to 2025. I classify adopters by applying a large language model to firms’ open-ended process innovation descriptions, identifying 1, 656 AI and automation adopters (1.9 percent of the sample). A ten-percentage-point increase in the old-age dependency ratio raises process adoption probability by approximately 0.6 percentage points, after accounting for countries’ income levels, digital infrastructure, firm size and sector, and broad regional and time differences. The result is robust across specifications and supported by an instrumental variable strategy based on predetermined demographic cohort structure. Heterogeneity analysis shows the effect concentrates in manufacturing, large firms, and developing economies for the broad adoption measure; restricting to firms with explicit references to AI reverses the sector pattern, with services firms significantly more likely to adopt than manufacturing firms, pointing to distinct sectoral profiles for software-based AI and hardware-based automation. Aging also predicts firms’ development of AI-enabled products across both manufacturing and services. The results indicate that demographic aging shapes AI and automation adoption through both process and product innovation channels: firms substitute technology for increasingly scarce and costly labor in production, and separately develop AI-enabled products for labor-constrained customers. |
| Keywords: | Aging; automation; artificial intelligence; firm-level; technology adoption; labor-saving technology; World Bank Enterprise Surveys; demographics; labor substitution |
| Date: | 2026–08–21 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2026/176 |