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on Economics of Ageing |
| By: | Kotono Tanigawa (Kumamoto Gakuen University); Tomoya Sakagami (Kumamoto Gakuen University) |
| Abstract: | In this paper, we present a pension policy that supplements the pay-as-you-go pension system with payments by old generations with a high assets income. This supplement is intended to reduce intergenerational inequity. To analyze the effect of this pension policy on both capital stock in the economy and the utilities of the rich and the poor, we build an Over-Lapping Generations model with different incomes when young. This model finds that the stable steady-state capital stock level increases as the old rich generation contributes to the pension system. We also find by numerical simulations that there is a Pareto efficient premium level between high-income and low-income people. |
| Keywords: | pay-as-you-go pension system, intergenerational inequity, overlapping generations model |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:kyo:wpaper:1067&r= |
| By: | Antoine Bozio (IFS - Laboratory of the Institute for Fiscal Studies - Institute for Fiscal Studies, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Clémentine Garrouste (Legos - Laboratoire d'Economie et de Gestion des Organisations de Santé - Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres, LEDa - Laboratoire d'Economie de Dauphine - CNRS - Centre National de la Recherche Scientifique - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres); Elsa Perdrix (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | This paper investigates the impact of delaying retirement on mortality amongthe French population. We take advantage of the 1993 pension reform in the private sector to identify the causal effect of an increase in claiming age on mortality. We use administrative data which provide detailed information on career characteristics, dates of birth and death. Our results, precisely estimated, show that an exogenous increase of one year in the claiming age has no significant impact on the probability to die, measured between age 61 and 79. To test the power of our sample to detect statistically significant effects for rare events like death, we compute minimum detectable effects (MDE). Our MDE estimates suggest that, if an impact of later retirement on mortality would be detectable, it would remain very small in magnitude. |
| Keywords: | Mortality,Pension reform,Health |
| Date: | 2021–09–23 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03352846&r= |
| By: | Antoine Bozio (IFS - Laboratory of the Institute for Fiscal Studies - Institute for Fiscal Studies, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Clémentine Garrouste (Legos - Laboratoire d'Economie et de Gestion des Organisations de Santé - Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres, LEDa - Laboratoire d'Economie de Dauphine - CNRS - Centre National de la Recherche Scientifique - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres); Elsa Perdrix (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | This paper investigates the impact of delaying retirement on mortality amongthe French population. We take advantage of the 1993 pension reform in the private sector to identify the causal effect of an increase in claiming age on mortality. We use administrative data which provide detailed information on career characteristics, dates of birth and death. Our results, precisely estimated, show that an exogenous increase of one year in the claiming age has no significant impact on the probability to die, measured between age 61 and 79. To test the power of our sample to detect statistically significant effects for rare events like death, we compute minimum detectable effects (MDE). Our MDE estimates suggest that, if an impact of later retirement on mortality would be detectable, it would remain very small in magnitude. |
| Keywords: | Mortality,Pension reform,Health |
| Date: | 2021–09–23 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:hal-03352846&r= |
| By: | Maira Colacce (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Julia Córdoba (Universidad de la República (Uruguay). Facultad de Psicología. Programa de Discapacidad y Calidad de Vida); Alejandra Marroig (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Estadística); Guillermo Sánchez (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía) |
| Abstract: | This study seeks to characterize the dependent population in Uruguay, either due to aging or disability, through the construction of dependency profiles. A latent class model is implemented to synthesize the information from multiple questions associated with the need for help in activities of daily living based on the Longitudinal Survey of Social Protection. Four classes of dependency were obtained both among people over 59 and people with disabilities under 60. In the two populations there is a group of people without dependency; another group of people who require help in a wide range of activities, always including the basic ones (eating, using the bathroom, dressing, walking, getting out of bed); and an intermediate group that is characterized by needing help in various instrumental activities and who may require support in some basic activity, but not in eating. The other two groups are different between older people and people with disabilities. In the case of the elderly, the fourth group only requires help in carrying out household chores and in moving outside the home, made up exclusively of women. In people with disabilities, a group is distinguished that is handicapped by a more psychological than physical component, which presents higher levels of need for help in communicating, socializing and avoiding risks. This type of groupings contributes to the design of policies since it is probable that the type of care and assistance required by people in a situation of dependency is related to the categories resulting from the latent classes model in a way that complements the indices that assign degrees of severity to said dependence. |
| Keywords: | Latent groups, Aging, Disability, Long-Term Care, Dependence, Uruguay |
| JEL: | I14 C38 J14 |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:ulr:wpaper:dt-23-21&r= |
| By: | Philippe de Donder (TSE - Toulouse School of Economics - UT1 - Université Toulouse 1 Capitole - Université Fédérale Toulouse Midi-Pyrénées - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Marie-Louise Leroux (UCL - Université Catholique de Louvain) |
| Abstract: | We study the demand for actuarially fair Long Term Care (LTC hereafter) insurance in a setting where autonomous agents only care for daily life consumption while dependent agents also care for LTC expenditures. We assume that dependency decreases the marginal utility of daily life consumption. We rst obtain that some agents optimally choose not to insure themselves, while no agent wishes to buy complete insurance. We then show that the comparison of marginal utility of income (as opposed to consumption) across health states depends on (i) whether agents do buy LTC insurance at equilibrium or not, (ii) the comparison of the degree of risk aversion for consumption and for LTC expenditures, and (iii) the income level of agents. Our results then oer testable implications that can explain (i) why few people buy Long Term Care insurance and (ii) the discrepancies between various empirical works when measuring the extent of state-dependent preferences for LTC. |
| Keywords: | Risk Aversion,Actuarially Fair Insurance,Long Term Care Insurance Puzzle,State-dependent Preferences. |
| Date: | 2021–09–13 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03351447&r= |
| By: | Jie Zhou |
| Abstract: | Earlier research has documented that debt at older ages has increased significantly in Canada over the period from 1999 to 2016. In this article, we explore the consequences of a growing proportion of older Canadian households experiencing financial vulnerability. After controlling for household characteristics, we find among older households that a high debt-to-asset ratio and very low liquid wealth are significantly and positively associated with skipping or delaying a mortgage or non-mortgage debt payment and with usually paying the minimum amount or less on credit cards in the previous year. The debt-to-income ratio, however, is not an important indicator of financial vulnerability for older households. |
| JEL: | D14 G51 |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:win:winwop:2021-01&r= |
| By: | Ismaël Choinière Crèvecoeur; Pierre-Carl Michaud |
| Abstract: | High borrowing costs, limited knowledge and preferences could explain why few Canadians purchase reverse mortgages, an asset decumulation product that is appealing to those who are house-rich but cash-poor. In this paper, we first use an asset pricing model to calculate the actuarial fair costs of guarantees built into reverse mortgage products in Canada and compare those estimates to prevailing interest rates in the market for these products. We also investigate whether Canadians understand reverse mortgages and whether low demand originates on the preference side by conducting a stated-preference experiment with 3000 Canadians. We manipulate characteristics of reverse mortgages, including the interest rate, to tease out how sensitive Canadians are to these characteristics. Our results suggest that observed interest rates are high relative to actuarially fair rates and that consumers are somewhat price sensitive in addition to demonstrating little knowledge of these products and low demand overall. |
| Keywords: | reverse mortgages, savings, retirement planning, insurance. |
| JEL: | G21 R21 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:rsi:creeic:2107&r= |