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on Economics of Ageing |
| By: | Thorben Korfhage |
| Abstract: | In this paper, I estimate a dynamic structural model of labor supply, retirement, and informal care supply, incorporating labor market frictions and the German tax and benefit system. I find that informal elderly care has adverse and persistent effects on labor market outcomes and therefore negatively affects lifetime earnings, future pension benefits, and individuals’ well-being. These consequences of caregiving are heterogeneous and depend on age, previous earnings, and institutional regulations. Policy simulations suggest that, even though fiscally costly, public long-term care insurance can offset the personal costs of caregiving to a large extent – in particular for low-income individuals. |
| Keywords: | long-term care; informal care; long-term care insurance; labor supply; retirement; pension benefits; structural model |
| JEL: | I18 I38 J14 J22 J26 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp1051&r=all |
| By: | Pamela Giustinelli; Charles F. Manski; Francesca Molinari |
| Abstract: | We elicit numerical expectations for late-onset dementia in the Health and Retirement Study. Our elicitation distinguishes between precise and imprecise probabilities, while accounting for rounding of reports. Respondents quantify imprecision using probability intervals. Nearly half of respondents hold imprecise dementia probabilities, while almost a third of precise-probability respondents round their reports. We provide the first empirical evidence on dementia-risk perceptions among dementia-free older Americans and novel evidence about imprecise probabilities in a nationally-representative sample. We show, in a specific framework, that failing to account for imprecise or rounded probabilities can yield incorrect predictions of long-term care insurance purchase decisions. |
| JEL: | D80 D84 I0 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26125&r=all |
| By: | Anya Samek; Arie Kapteyn; Andre Gray |
| Abstract: | Evidence shows that people have difficulty understanding complex aspects of retirement planning, which leads them to under-utilize annuities and claim Social Security benefits earlier than is optimal. To target this problem, we developed vignettes about the consequences of different annuitization and claiming decisions. We evaluated our vignettes using an experiment with a representative online panel of nearly 2,000 Americans. In our experiment, respondents were either assigned to a control group with no vignette, to a written vignette, or to a video vignette. They were then asked to give advice to hypothetical persons on annuitization or Social Security claiming, and were asked factual questions about these concepts. We found evidence that being exposed to vignettes led respondents to give better advice. For example, the gap between advised claim age for a relatively healthy person versus a relatively sick person was larger by nearly a year in the vignette treatments versus the control group. Further, the vignettes increased financial literacy related to these concepts by 10-15 percentage points. Interestingly, the mode of communication did not have a significant impact – the video and written vignettes were equally effective. |
| JEL: | H3 J26 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26176&r=all |
| By: | Pamela Giustinelli; Matthew D. Shapiro |
| Abstract: | The Subjective ex ante Treatment Effect is the difference between the probabilities of an outcome conditional on a treatment. The SeaTE yields ex ante causal effects at the individual level. The paper gives an interpretation in two workhorse econometric frameworks: potential outcomes and dynamic programming. It finds large effect heterogeneity of health on work in two surveys of older workers, the VRI and the HRS. It shows how reduced-form estimates of health on work are biased when there is unobserved heterogeneity in taste for work. Using the VRI’s panel structure, it validates the elicited conditional probabilities of work given health. |
| JEL: | C21 C83 D84 J26 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26087&r=all |
| By: | Gopi Shah Goda; Matthew R. Levy; Colleen Flaherty Manchester; Aaron Sojourner; Joshua Tasoff |
| Abstract: | Defaults have been shown to have a powerful effect on retirement saving behavior yet there is limited research on who is most affected by defaults and whether this varies based on features of the choice environment. Using administrative data on employer-sponsored retirement accounts linked to survey data, we estimate the relationship between retirement saving choices and individual characteristics – long-term discounting, present bias, financial literacy, and exponential growth bias – under two distinct choice environments: an opt-in regime and an auto-enrollment regime. Consistent with our conceptual model, we find that the determinants of following the default and contribution behavior are regime-specific. Under the opt-in regime, financial literacy plays an important role in predicting total contributions, active saving choices, and maxing out contributions in the tax-preferred account. In contrast, under the auto-enrollment regime, present bias is the most significant behavioral predictor of contribution behavior. A causal interpretation of the estimates suggests that auto-enrollment increases saving primarily among those with low financial literacy. |
| Keywords: | present bias, exponential-growth bias, household finance, retirement savings decisions, choice architecture, defaults, financial literacy, procrastination |
| JEL: | D91 J26 G11 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2019-050&r=all |
| By: | J. Dustin Tracy, (Economic Science Institute, Chapman University); Hillard Kaplan (Economic Science Institute, Chapman University); Kevin A. James (Economic Science Institute, Chapman University); Stephen J. Rassenti (Economic Science Institute, Chapman University) |
| Abstract: | We examine the impacts of age, income and insurance plan on behavior in a virtual environment with cash-motivated subjects, who live multi-period lives in which they earn income and spend on enjoyment, insurance, and investments in health. Health shocks increase simulating aging. The 2x2 experimental has high and low income subjects, and offers employer-based or actuarial insurance. We find: 1) subject behavior approximated optimal responses; 2) in all treatments, subjects under-invested in health early in life and over-invested in health late in life; 3) subjects in the employerbased plan purchased insurance at higher rates; 4) the employer-based plan reduced differences due to income and age; 5) subjects in the actuarial plan engaged in more health-promoting behaviors, but still below optimal levels, and did save at the level required, so did realize the full benefits of the plan. Should these results generalize, they have clear implications for the health insurance policy. |
| Keywords: | Health insurance, Moral Hazard, Inter-generational, Subsidies, Actuarially fair, Employer-based |
| JEL: | I11 I12 I13 I14 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:chu:wpaper:19-16&r=all |
| By: | Thonipara, Anita; Proeger, Till; Haverkamp, Katarzyna |
| Abstract: | Die sozioökonomische Lage und die Alterssicherung Selbstständiger im Handwerk ist ein wirtschafts-, sozial- und handwerkspolitisch relevantes Forschungsfeld, innerhalb dessen aktuell Diskussionen zur Weiterentwicklung der Struktur der Altersvorsorge im Handwerk geführt werden. Auf wissenschaftlicher Seite besteht jedoch ein Mangel an empirischer Grundlagenforschung, welche der politischen Diskussion als Entscheidungsgrundlage bereitgestellt werden kann. Der vorliegende Literaturüberblick leistet daher eine Zusammenfassung der wissenschaftlichen Studien zur Alterssicherung selbstständiger Handwerker in Deutschland und formuliert auf Basis dessen eine Forschungsagenda, um dieser Forschungslücke zu begegnen. Hierin wird zunächst eine repräsentative Strukturerhebung auf Basis des Mikrozensus skizziert. Aufbauend auf dieser Grundlagenanalyse wird eine Clusteranalyse der verschiedenen Einkommens- und Vorsorgetypen innerhalb der handwerklichen Selbstständigen beschrieben, die durch eine Verhaltensanalyse auf Basis qualitativer Forschung ergänzt wird. Insgesamt leistet diese Studie somit eine kompakte Zusammenfassung des Forschungsstands und einen Vorschlag zur künftigen empirischen Forschung. |
| Keywords: | Altersvorsorge,Handwerk,Handwerkerpflichtversicherung,Literaturüberblick,Selbstständige,German craft sector,Literature review,Old-age provision,Retirement schemes of craftsmen,Self-employed craftsmen |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifhgbh:25&r=all |
| By: | Sarah Miller; Sean Altekruse; Norman Johnson; Laura R. Wherry |
| Abstract: | We use large-scale federal survey data linked to administrative death records to investigate the relationship between Medicaid enrollment and mortality. Our analysis compares changes in mortality for near-elderly adults in states with and without Affordable Care Act Medicaid expansions. We identify adults most likely to benefit using survey information on socioeconomic and citizenship status, and public program participation. We find a 0.13 percentage point decline in annual mortality, a 9.3 percent reduction over the sample mean, associated with Medicaid expansion for this population. The effect is driven by a reduction in disease-related deaths and grows over time. We find no evidence of differential pre-treatment trends in outcomes and no effects among placebo groups. |
| JEL: | I1 I13 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26081&r=all |
| By: | López, Martha; Sarmiento G., Eduardo |
| Abstract: | En el documento se describe el sistema pensional colombiano. Luego de la reforma de la Ley 100 mejoraron las afiliaciones, lo cual implica un aumento también de las cotizaciones y la cobertura de los pensionados en el futuro. En la actualidad la cobertura de las pensiones es apenas 23% y menos de 1,5 millones de personas. Esto se debe, en parte, a la existencia de un mercado laboral con un sector informal amplio (47,3%). Las mayores tasas de reemplazo del sistema público con respecto al privado ocasionan traslados del segundo al primero, lo que pone más presión en las finanzas públicas. Por lo anterior, se propone establecer un sistema de 3 pilares vigente en otros países como Chile. Actualmente, por nivel de ingreso, cerca de 80% de los cotizantes corresponde a personas con menos de 2 SMMLV; sin embargo, un alto monto de los subsidios del RPM se destina a la población con mayores ingresos. El gasto en transferencias con cargo a la Nación fue de 3,4% del PIB y el pasivo pensional fue cercano al 130% del PIB. Teniendo en cuenta las anteriores consideraciones, en este documento se plantea la necesidad de una reforma pensional que mejore la cobertura, aumente las transferencias a la población más pobre y no incremente los requerimientos de presupuesto de la Nación. |
| Keywords: | Pensiones; cobertura; finanzas públicas; tasa de reemplazo |
| JEL: | E21 G23 H55 H62 H68 I31 |
| Date: | 2019–09 |
| URL: | http://d.repec.org/n?u=RePEc:rie:riecdt:16&r=all |