Population aging and legal retirement age

Lacomba, Juan Antonio; Lagos, Francisco

doi:10.1007/s00148-005-0044-9

Cited by 34 publications

(24 citation statements)

References 13 publications

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“…Recent work that considers the implications of ageing on pension systems includes Ono (2003) and Lacomba and Lagos (2006). Ono (2003) shows that debt funded social security systems can lead to dynamic inefficiencies and multiple equilibria, while Lacomba and Lagos (2006) focus on the effects of ageing on the optimal statutory retirement age. They find the effects depend on whether the pension system is a defined contribution or defined benefit scheme.…”

Section: Equilibriummentioning

confidence: 99%

Pension reform and labor market incentives

Fisher

Keuschnigg

2008

J Popul Econ

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This paper investigates how parametric reform in a pay-as-you-go pension system with a tax benefit link affects retirement and work incentives of prime-age workers. We find that postponed retirement tends to harm incentives of prime-age workers in the presence of a tax benefit link, thereby creating a policy trade-off in stimulating aggregate labor supply. We show how several popular reform scenarios are geared either towards young or old workers, or, indeed, both groups under appropriate conditions. We also provide a sharp characterization of the excess burden of pension insurance and show how it depends on the behavioral supply elasticities of the extensive and intensive margins and the effective tax rates implicit in contribution rates.JEL Code: H55, J26.

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Section: Equilibriummentioning

confidence: 99%

Pension reform and labor market incentives

Fisher

Keuschnigg

2008

J Popul Econ

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“…Utilitarianism also prevails in optimal retirement age studies in a dynamic setting (see Crettez and Le Maitre, ; Michel and Pestieau, ; Lacomba and Lagos, ).…”

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confidence: 99%

Fair Retirement Under Risky Lifetime*

Fleurbaey

Leroux

Ponthière

2016

Int Economic Review

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A premature death unexpectedly brings a life and a career to their end, leading to substantial welfare losses. We study the retirement decision in an economy with risky lifetime, and compare the laissez-faire with egalitarian social optima. We consider two social objectives: (1) the maximin on expected lifetime welfare (ex ante), allowing for a compensation for unequal life expectancies; (2) the maximin on realized lifetime welfare (ex post ), allowing for a compensation for unequal lifetimes. The latter optimum involves, in general, decreasing lifetime consumption pro…les, as well as raising the retirement age, unlike the ex ante egalitarian optimum. This result is robust to the introduction of unequal life expectancies and unequal productivities. Hence, the postponement of the retirement age can, quite surprisingly, be defended on egalitarian grounds -although the conclusion is reversed when mortality strikes only after retirement.

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“…In a study for the UK it is claimed that a gradual increase in retirement age to 68.5 in 2050 and 70.2 in 2070 will keep the ratio of people over state-pension age (SPA+) to the cohort comprising those aged from 20 years until SPA relatively stable (Turner, 2009). An increase in contribution rates would alternatively delay the introduction of preferred retirement age (Lacomba and Lagos, 2006). However, the major threat is still imposed by declining fertility rates and inability of future working generations to absorb without a large illiquidity discount an overhang of assets managed on behalf of the retirement age population.…”

Section: Literature Reviewmentioning

confidence: 99%