Mortality transition and differential incentives for early retirement

Hippolyte d'Albis, Paul Lau Sau-Him and Miguel Sánchez-Romero
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Paul Lau Sau-Him: HKU - School of Economics and Finance - HKU - The University of Hong Kong

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Abstract: Many studies specify human mortality patterns parametrically, with a parameter change affecting mortality rates at different ages simultaneously. Motivated by the stylized fact that a mortality decline affects primarily younger people in the early phase of mortality transition but mainly older people in the later phase, we study how a mortality change at an arbitrary age affects optimal retirement age. Using the Volterra derivative for a functional, we show that mortality reductions at older ages delay retirement unambiguously, but that mortality reductions at younger ages may lead to earlier retirement due to a substantial increase in the individual's expected lifetime human wealth.

Keywords: mortality decline; incentive for early retirement; years-to-consume effect; lifetime human wealth effect (search for similar items in EconPapers)
Date: 2012-01
Note: View the original document on HAL open archive server: https://hal.science/hal-00659868
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Citations: View citations in EconPapers (2)

Published in Journal of Economic Theory, 2012, 147 (1), pp.261-283. ⟨10.1016/j.jet.2011.11.004⟩

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Related works:
Journal Article: Mortality transition and differential incentives for early retirement (2012)
Working Paper: Mortality transition and differential incentives for early retirement (2012)
Working Paper: Mortality transition and differential incentives for early retirement (2012)
Working Paper: Mortality transition and differential incentives for early retirement (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-00659868

DOI: 10.1016/j.jet.2011.11.004

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