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on Economics of Ageing |
| By: | Hagen, Johannes; Hallberg, Daniel; Sjögren Lindquist, Gabriella |
| Abstract: | We study the effects of two exogenous modifications in the Swedish pension system application form nudging individuals towards a fixed-term payout. Meanwhile, the set of available options and the default option - life annuity - were unchanged during the period under study. We examine the effects on individuals' payout decisions and the spillover effects on labour supply and other pensions using a difference-in-difference framework and detailed administrative data on actual payout decisions and a wide range of individual-level outcomes. Each modification increased the demand for the nudged payout by around 30 percentage points. The first modification also induced individuals to work less. |
| Keywords: | annuity,pension,nudge,decision framing |
| JEL: | D91 G41 J26 J32 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:209pre&r= |
| By: | Bell, Matthew |
| Abstract: | The New Zealand Superannuation Fund (NZSF) is one of New Zealand’s largest publicly-owned financial assets. Its primary purpose is to act as an inter-generational tax smoothing vehicle, in order to assist future taxpayers cover the cost of providing the public pension, New Zealand Superannuation (NZS). New Zealand’s ageing population structure will, in the absence of any changes to pension settings, lead to a significant lift in NZS expenditure as a percentage of gross domestic product (GDP) over the next few decades. The paper includes an explanation of the reasons behind why this demographic change is occurring and will continue to unfold over the foreseeable future. The paper contributes a comprehensive analysis of the NZSF’s role in New Zealand’s public finances. This includes descriptions and modelling of NZS and the NZSF, explanations of the mathematical relationships behind the NZSF’s legislated contribution rate formula, and a brief history of the NZSF. Future outcomes for the NZSF’s size and role in helping to fund NZS, depending on scenarios that vary the evolution of NZS relative to GDP, are illustrated and explained. How and why projections related to the NZSF have changed over time is also analysed and explained, including what factors have had the most influence on these changes. The paper does not comment on the merits of policy decisions that have been made in regard to either NZS or the NZSF. That is not the paper’s purpose, outside of covering any aspects of these in regard to how the NZSF has evolved or may evolve in future, or how its logic operates. |
| Keywords: | Single Equation Model, Financial Forecast, Old Age Assistance, Public Pension, Pay as You Go, |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:vuw:vuwcpf:9470&r= |
| By: | Martinez-Jimenez, M.; Hollingsworth, B.; Zucchelli, E. |
| Abstract: | We explore the effects of retirement on both physical and mental ill-health and whether these change in the presence of economic shocks. We employ inverse probability weighting regression adjustment to examine the mechanisms influencing the relationship between retirement and health and a difference-in-differences approach combined with matching to investigate whether the health effects of retirement are affected by the Great Recession. We estimate these models on data drawn from the English Longitudinal Study of Ageing (ELSA) and find that retirement leads to a deterioration in both mental and physical health, however there seems to be considerable effect heterogeneity by gender and occupational status. Our findings also suggest that retiring shortly after the Great Recession appears to improve mental and physical health, although only among individuals working in the most affected regions. Overall, our results indicate that the health effects of retirement might be influenced by the presence of economic shocks. |
| Keywords: | retirement; health; Great Recession; ELSA; |
| JEL: | J14 J26 I10 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:yor:hectdg:21/11&r= |
| By: | Andreas Irmen |
| Abstract: | How does population aging affect economic growth and factor shares in times of increasingly automatable production processes? The present paper addresses this question in a new macroeconomic model of automation where competitive firms perform tasks to produce output. Tasks require labor and machines as inputs. New machines embody superior technological knowledge and substitute for labor in the performance of tasks. Automation is labor-augmenting in the reduced-form aggregate production function. If wages increase then the incentive to automate becomes stronger. Moreover, the labor share declines even though the aggregate production function is Cobb-Douglas. Population aging due to a higher longevity reduces automation in the short and promotes it in the long run. It boosts the growth rate of absolute and per-capita GDP in the short and the long run, lifts the labor share in the short and reduces it in the long run. Population aging due to a decline in fertility increases automation, reduces the growth rate of GDP, and lowers the labor share in the short and the long run. In the short run, it may or may not increase the growth rate of per-capita GDP, in the long run it unequivocally accelerates per-capita GDP growth. |
| Keywords: | population aging, automation, factor shares, endogenous technical change, endogenous labor supply |
| JEL: | E22 J11 J22 J23 O33 O41 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9193&r= |
| By: | Henry, Carla.; Golman, Matías. |
| Abstract: | This paper considers the rapid demographic ageing trend experienced in many middle-income countries and examines how the dimensions of these demographic shifts can be combined with other dimensions related to employment, retirement and social protection in order to classify countries according to their level of preparedness to secure adequate income for their rapidly ageing population. This paper differs from other such studies as it deliberately incorporates employment measures and distributional aspects alongside economic and social protection measures in calculating a preparedness and vulnerability index. Patterns of work and income security up to and during old age were incorporated into the index using data from 35 middle-income and upper-middle- income countries, all of which will face ageing populations over the next 10 to 30 years. The index presented in this paper differs from other indices as it incorporates current employment dimensions relevant to the delivery of old-age income security in the future. Drawing from a wide array of country-specific indicators, this study seeks to identify configurations of descriptive variables that can approximate underlying relative differences between countries in terms of economic and social preparedness, distributional vulnerability and gender inequality. The results of the factor analysis suggest that, for social preparedness, the standard of living and strength of social protection in a country are two important underlying factors. For distributional vulnerability, the relative prevalence of low-quality employment and of poverty combined with inequality are the two dominant underlying factors which can be used to distinguish between countries. Finally, for gender inequality, the employment gender gap is the main factor, comprising gender differences in labour force participation and in youth preparedness for employment, both of which significantly influence life-long earnings and retirement income. |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ilo:ilowps:995132793502676&r= |
| By: | Henkens, Kène; van Dalen, Hendrik Peter (Tilburg University, School of Economics and Management); van Solinge, Hanna |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiutis:0e39c6dd-3349-4842-a40b-e93eaa7a9f1b&r= |
| By: | Goulão, Catarina; Pérez-Barahona, Agustín |
| Abstract: | We look at how social norms regarding health aect the dynamics of an epidemic of NCDs. We present an overlapping generations model in which agents live for three periods (childhood, adulthood and old age). Adulthood consumption choices have a impact on the health capital of the following period, which is in part inherited by their ospring and aects their osprings' probability of developing a NCD. As a result of this intergenerational externality, agents would choose lower health conditions and higher unhealthy activities than that which is socially optimal. In addition, parental choices aect their own old age health capital with which their ospring compare their own. A social norm imposing agents to be as healthy as the previous generation balances the negative eects of unhealthy adulthood choices. Fiscal policies alone or combined with public policies regarding social norms can be used to restore optimality. Our results underline the interplay between sin taxes and health-related social norms. |
| JEL: | H21 H23 I18 |
| Date: | 2021–07–30 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:125836&r= |
| By: | Matteo Picchio (Dipartimento di Scienze Economiche e Sociali - Universita' Politecnica delle Marche); Mattia Filomena (Dipartimento di Scienze Economiche e Sociali - Universita' Politecnica delle Marche) |
| Abstract: | This paper presents a meta-analysis on the effects of retirement on health. We select academic papers published between 2000 and 2021 studying the impact of retirement on physical and mental health, self-assessed general health, healthcare utilization and mortality. Among 275 observations from 85 articles, 28% (13%) find positive (negative) effects of retirement on health outcomes. Almost 60% of the observations do not provide statistically significant findings. Using meta-regression analysis, we checked for the presence of publication bias after distinguishing among different journal subject areas and, once correcting for it, we find that the average effect of retirement on health outcomes is small and barely significant. We apply several model averaging techniques to explore possible sources of heterogeneity and our results suggest that the different estimated effects can be explained by the differences in both health measurements and retirement schemes. |
| Keywords: | Retirement; health; meta-analysis; meta-regression; publication bias. |
| JEL: | I10 J14 J26 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:anc:wpaper:458&r= |
| By: | Catarina Peralta (Faculty of Economics, University of Porto); Pedro Mazeda Gil (Faculty of Economics, University of Porto and CEF.UP) |
| Abstract: | We address two main structural changes occurring in developed countries: the rise of automation and population ageing. We use an R&D-based growth model in an OLG framework with endogenous education and fertility, and automation in the production process. Our model is able to combine the growth of real wages over time and either a fall or an increase in birth rates, consistent with recent data regarding the birth rate by skill group. Moreover, our model allows for the study of the interplay between the effects of population ageing and those of automation. The results show a dynamics consistent with the US trends for the period covering 1970 to 2019. |
| Keywords: | Ageing; Automation; Economic growth; Endogenous fertility |
| JEL: | J11 J23 J24 O3 O4 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:por:cetedp:2102&r= |
| By: | Abrigo, Michael R.M. |
| Abstract: | The study uses incidence analysis to examine the financial costs and benefits from the Philippine’s National Health Insurance Program (NHIP) through the Philippine Health Insurance Corporation (PhilHealth) that accrue to different age groups and socio-economic classes. It finds that premium contributions to and benefits payment by PhilHealth are both pro-poor. As a public transfers program, PhilHealth reallocates resources from higher to lower income population. As a pseudo-pension program, it transfers resources from workers to finance health care of retirees. As a health insurance, its premium contributions are not actuarially fair given the benefits it provides. Over the course of an average Filipino’s lifetime, the NHIP is estimated to lose about 40 centavos for every peso an individual contributes directly or indirectly as premium to PhilHealth. <p> Comments to this paper are welcome within 60 days from date of posting. Email publications@mail.pids.gov.ph. |
| Keywords: | social health insurance, Philippines, National Transfer Account, Benefit incidence analysis, Cost incidence analysis |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:phd:dpaper:dp_2020-51&r= |
| By: | Alfonso R. Sánchez Martín; Sergi Jiménez Martín |
| Abstract: | Muchos países europeos han desarrollado programas que permiten la compatibilización del cobro de la pensión con los ingresos de la actividad laboral. Estos programas son interesantes en un contexto de envejecimiento poblacional porque podrían aumentar la oferta de trabajo sin introducir costes adicionales en los sistemas de pensiones. Así, la producción adicional generada podría repartirse entre el trabajador, la empresa y la Seguridad Social de modo que todos ellos mejorasen respecto al mundo sin compatibilización. Que este resultado se obtenga en la práctica o no depende, sin embargo, de las normas institucionales en vigor y de la respuesta de comportamiento de los agentes. Si, por ejemplo, los trabajadores reaccionan adelantando su edad de cobro de pensión sin modificar la edad de jubilación no habría aumento de oferta de trabajo y el gasto de la Seguridad Social podría aumentar. |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaeee:eee2021-25&r= |