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on Economics of Ageing |
| By: | Maria Donovan Fitzpatrick |
| Abstract: | Public sector employees receive large fractions of their lifetime income in the form of deferred compensation. The introduction of the opportunity provided to Illinois public school employees to purchase additional pension benefits allows me to estimate employees' willingness-to-pay for benefits relative to the cost of providing them. The results show employees are willing to pay 20 cents on average for a dollar increase in the present value of expected retirement benefits. The findings suggest substantial inefficiency in compensation and cast doubt on the ability of deferred compensation schemes to attract employees. |
| JEL: | H55 H72 H75 I22 J26 J45 |
| Date: | 2014–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:20582&r=age |
| By: | Teresa Ghilarducci; Joelle Saad-Lessler (Schwartz Center for Economic Policy Analysis (SCEPA)) |
| Abstract: | Workplace retirement plans (DC and DBs) help workers save for retirement conveniently, consistently, and automatically. But retirement account offer rates are steadily declining. Between 2001-2003 and 2010-2012, the retirement plan offer rate dropped from 63% to 55%. The drop is driven by a decline in both DB and DC plans. Using a probit model and an Oaxaca-Blinder threefold decomposition technique applied to data from the CPS for 2001-2003 and 2010-2012, and using longitudinal analysis of the SIPP 2008 panel waves 3 and 11, the authors find that the labor-contracting environment dominates individual and firm level variables among factors determining whether employers offer a retirement account to their workers. Therefore, attempts to raise retirement account offer rates must address the decline in workers’ bargaining power and the changes in norms relating to benefits provision. This study contributes to the important discussion about the trends in DB and DC coverage and the decline in retirement security. |
| Keywords: | Bargaining power, employer retirement plan offer rate |
| JEL: | J26 J32 J50 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:epa:cepawp:2014-2&r=age |
| By: | Nicolas Moreau (University of Reunion Island - Université de la Réunion); Elena Stancanelli (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris) |
| Abstract: | Earlier literature has investigated the drop in household consumption upon retirement of the head of the household, the so-called "retirement consumption puzzle". Here, we expand on these studies by considering also retirement of the wife, thus distinguishing households in which the wife is a "housewife" from 'dual-earners'. We use a regression discontinuity approach to estimate the effect of each partner's retirement on household consumption. We use for the analysis data drawn from the French Consumer Budget Survey 2001 that collected two-week expenditure diaries. We find a significant and sizable drop in food and clothes expenditure upon retirement of the male partner. However, the drop in food expenditure is not robust to specification checks and it becomes statistically insignificant when dropping from the sample couples in which the wife is a housewife. |
| Keywords: | Consumption; ageing; retirement; regression discontinuity |
| Date: | 2013–10 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00881215&r=age |
| By: | Raimond Maurer; Olivia S. Mitchell; Ralph Rogalla; Tatjana Schimetschek |
| Abstract: | This paper investigates whether exchanging the Social Security delayed retirement credit (currently paid as an increase in lifetime annuity benefits) for a lump sum would induce later claiming and additional work. We show that people would voluntarily claim about half a year later if the lump sum were paid for claiming any time after the Early Retirement Age, and about two-thirds of a year later if the lump sum were paid only for those claiming after their Full Retirement Age. Overall, people will work one-third to one-half of the additional months, compared to the status quo. Those who would currently claim at the youngest ages are likely to be most responsive to the offer of a lump sum benefit. |
| JEL: | D04 D1 D12 D14 G22 H55 |
| Date: | 2014–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:20614&r=age |
| By: | Jeffrey B. Liebman; Erzo F.P. Luttmer |
| Abstract: | The degree to which the Social Security tax distorts labor supply depends on the extent to which individuals perceive the link between current earnings and future Social Security benefits. Some Social Security reform plans have been motivated by an assumption that workers fail to perceive this link and that increasing the salience of the link could result in significant efficiency gains. To measure the perceived linkage between labor supply and Social Security benefits, we administered a survey to a representative sample of Americans aged 50-70. We find that the majority of respondents believe that their Social Security benefits increase with labor supply. Indeed, respondents generally report a link between labor supply and future benefits that is somewhat greater than the actual incentive. We also surveyed people about their understanding of various other provisions in the Social Security benefit rules. We find that some of these provisions (e.g., effects of delayed benefit claiming and rules on widow benefits) are relatively well understood while others (e.g., rules on spousal benefits, provisions on which years of earnings are taken into account) are less well understood. In addition, our survey incorporated a framing experiment, which shows that how the incentives for delayed claiming are presented has an impact on hypothetical claiming decisions. In particular, the traditional "break-even" framing used by the Social Security Administration leads to earlier claiming than other presentations do. |
| JEL: | D83 H55 |
| Date: | 2014–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:20562&r=age |
| By: | Susan T. Stewart; David M. Cutler |
| Abstract: | Adverse behavioral risk factors contribute to a large share of deaths. We examine the effects on life expectancy (LE) and quality-adjusted life expectancy (QALE) of changes in six major behavioral risk factors over the 1960-2010 period: smoking, obesity, heavy alcohol use, and unsafe use of motor vehicles, firearms, and poisonous substances. These risk factors have moved in opposite directions. Reduced smoking, safer driving and cars, and reduced heavy alcohol use have led to health improvements, which we estimate at 1.82 years of quality-adjusted life. However, these were roughly offset by increased obesity, greater firearm deaths, and increased deaths from poisonous substances, which together reduced quality-adjusted life expectancy by 1.77 years. We model the hypothetical effects of a 50% decline in morbid obesity and in poisoning deaths, and a 10% decline in firearm fatalities, roughly matching favorable trends in smoking and increased seat belt use. These changes would lead to a 0.92 year improvement in LE and a 1.09 year improvement in QALE. Thus, substantial improvements in health by way of behavioral improvements and public health are possible. |
| JEL: | I1 I10 I12 I18 |
| Date: | 2014–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:20631&r=age |
| By: | Otterbach, Steffen (University of Hohenheim); Sousa-Poza, Alfonso (University of Hohenheim) |
| Abstract: | In this paper, we use 12 waves of the German Socio-Economic Panel to examine the relationship between job insecurity, employability and health-related well-being. Our results indicate that being unemployed has a strong negative effect on life satisfaction and health. They also, however, highlight the fact that this effect is most prominent among individuals over the age of 40. A second observation is that job insecurity is also associated with lower levels of life satisfaction and health, and this association is quite strong. This negative effect of job insecurity is, in many cases, exacerbated by poor employability. |
| Keywords: | job insecurity, employment, employability, well-being, health, Germany |
| JEL: | J21 J22 |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8438&r=age |
| By: | Bamberger, Joshua D. (University of California, San Francisco); Dobbins, Sarah (San Francisco Department of Public Health) |
| Abstract: | This paper demonstrates that the greatest reduction in health care costs after placement in supportive housing is seen among chronically homeless adults and seniors who are frequent users of the health care system. Employing data from Mission Creek Apartments, a senior affordable housing project in San Francisco with 51 units reserved for homeless seniors, the researchers estimated savings to Medicaid and Medicare from avoiding placing these seniors in a skilled nursing facility of $9.2 million over 7 years. Their findings support the conclusion that permanent supportive housing can be a highly cost-effective placement option for homeless seniors exiting skilled nursing facilities, particularly as they approach the end of life, and points to the importance of this housing option for managed care organizations that are increasingly taking on the financial responsibility for the health care of this population. |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfcw:2014-01&r=age |
| By: | Alejandro Guevara (Department of Economics, Universidad Iberoamericana, Mexico City. Mexico); Juan Manuel Torres |
| Abstract: | The study identifies the existence of a bequest motive, or intergenerational value, closely related with the conservation of forests in poor rural communities with communal forests under logging. A survey with the contingent-valuation question type was applied to the households of two populations living in two contrasting forest communities. Results show that 83 and 71% of head of households declared a willingness to make an altruistic sacrifice for the subsequent enjoyment of their children of this forest resource, measured in different ways. Variables such as age, gender, income, education, and forest type are closely related with the bequest motive, as other literature has found to be the case regarding private forest owners. Differences among communities show that the larger the benefits they obtain from the forest resources they own, the larger the bequest motive. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:uic:wpaper:0614&r=age |