The Effect of Pensions on Longevity: Evidence from Union Army Veterans

Abstract

This study uses changes in pension laws for Union Army veterans as a natural experiment to estimate the causal effect of pensions on longevity, and to examine potential pathways underlying such a relationship. We examine the effects of the pension laws of 1907 and 1912, which granted old-age pensions to Union Army veterans. Life expectancy for veterans, who received such a pension, increased by 0.5 years and 2.7 years, respectively.The effect of veteran pensions on longevity was large across wealth groups and size of city. Pensions reduced mortality for both acute and non-acute causes of death.

To work or to work out: a moral-hazard interpretation of labor supply, retirement, and investments in longevity

“…For example Salm (2007) finds for US Army veterans that the sheer introduction of a pension system (in 1907 and 1912, respectively) increases life expectancy. For example Salm (2007) finds for US Army veterans that the sheer introduction of a pension system (in 1907 and 1912, respectively) increases life expectancy.…”

Life Expectancy in the 65 Years Old Population and Pensions Income

“…Výsledky byly korigovány na stejné demografické a socioekonomické podmínky v obou státech. Podobné výsledky z populace amerických armádních veteránů uvádí Salm (2). Vyšší důchody veteránů snižovaly jejich adjustovanou mortalitu a zvyšovaly naději na dožití 65letých a starších o 2,3 roku.…”

Policy Implications of Changing Longevity

“…Those intracountry inequalities in the duration of life can be substantial, and sometimes exceed the longevity inequalities between countries. Various factors explain those inequalities in the duration of life: the gender (Vallin 2002) the genetic background (Christensen et al 2006), the geographic location and environmental quality (Sartor 2002), the education level (Deboosere et al 2009), the income level (Pamuk 1985;Duleep 1986;Salm 2007), the socio-economic status (Contoyannis and Jones 2004), the employment status (Mullahy and Sindelar 1996), as well as individual lifestyles (Balia and Jones 2008). A simple way to illustrate the existence of strong longevity inequalities within countries is to look at the longevity gap between men and women.…”

“…A social planner concerned by minimizing the poverty rate is in favor of increasing the consumption of the poor old. Finally, a social planner adopting an ex post view would focus on the welfare of the poor who only lives one period, and thus supports the status quo, as 33 See Pamuk (1985), Duleep (1986), Deaton and Paxson (1998), Deaton (2003), Jusot (2003), and Salm (2007). …”