Workforce Aging, Pension Reforms, and Firm Outcomes

Carta, Francesca; D’Amuri, Francesco; Wachter, Till M. von

doi:10.2139/ssrn.3776976

Cited by 3 publications

(3 citation statements)

References 26 publications

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“…retirement of older workers (Carta et al 2021 While further research is needed to identify the precise mechanisms at work, our findings foretell a further slowdown in labor productivity growth reflecting not only compositional differences in the workforce but also real productivity losses among individuals across the age spectrum. At the same time, greater investment in human capital development throughout the lifecycle, greater utilization of labor-augmenting automation, and policies and practices that encourage employment at older ages could prevent these losses to some degree.…”

Section: Spillover Effects On Younger Age Groupsmentioning

confidence: 77%

The Effect of Population Aging on Economic Growth, the Labor Force, and Productivity

Maestas

Mullen

Powell

2023

American Economic Journal: Macroeconomics

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Population aging is expected to slow US economic growth. We use variation in the predetermined component of population aging across states to estimate the impact of aging on growth in GDP per capita for 1980–2010. We find that each 10 percent increase in the fraction of the population age 60+ decreased per capita GDP by 5.5 percent. One-third of the reduction arose from slower employment growth; two-thirds due to slower labor productivity growth. Labor compensation and wages also declined in response. Our estimate implies population aging reduced the growth rate in GDP per capita by 0.3 percentage points per year during 1980–2010. (JEL E23, E24, J11, J14, J31, O47)

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Section: Spillover Effects On Younger Age Groupsmentioning

confidence: 77%

The Effect of Population Aging on Economic Growth, the Labor Force, and Productivity

Maestas

Mullen

Powell

2023

American Economic Journal: Macroeconomics

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“…Moreover, timely introduction and continuous improvement of the deferred retirement policy have made elderly people healthier, their income more stable, and their time out of the labor market has been greatly delayed, reducing the negative impact of aging on the marginal product of capital. For example, in the last decades, governments have tried to increase the labor force participation by raising retirement age [ 32 ], and Carta F et al [ 33 ] who quantifies the effect of a policy-induced sharp increase in retirement ages on input mix and economic outcomes of firms using Italian matched worker-firm data find that the rising institutional retirement ages can help firms to retain valuable older employees in Italy. Secondly, developed countries have strong technological innovation capabilities, master core technologies, and invest heavily in scientific research, which promotes the application of labor substitution technology and compensates for the negative impact of insufficient labor force on marginal product of capital.…”

Section: Methodsmentioning

confidence: 99%

Dose the increasing burden of social endowment affect sustainable development of economy?

Yu,

Chen,

2024

PLoS ONE

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The rapid increase in the number of older people under the background of population aging has gradually changed the disease spectrum of society, making aging diseases more prevalent, and increasing the demand for health care services, medical and health services, and health insurance among older people, ultimately leading to increasing household and social spending on old age. This study is conducted to assess the impact of those spending burden on the sustainable development of economy and find out some practical and effective solutions. This paper constructs a theoretical model to illustrate the relationship between the old-age dependency ratio and the marginal product of capital (MPK), and then establishes a two-way fixed effect model based on transnational panel data of 81 countries from 1981 to 2017 to verify this relationship empirically. This paper finds that, after controlling a series of variables, an increased burden of old-age dependency leads to a decline in the MPK, a key macroeconomic variable and also a sustainable development criteria, but in which health care, health security systems, and technological innovation play a key and moderating role. The conclusion is also valid after tackling the problem of endogeneity with different methods, like two-stage least squares (TSLS) and the generalized methods of moments (GMM). Overall, before population aging, countries that are old-but-not-rich should encourage more supply-side investments in public health system or technological innovation, and adjust retirement system, or gradually encourage childbearing to strive for time and space for later sustainable development of public health system and economy.

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“…In his summary of these studies Hamermesh (1993) concluded that the weight of the evidence indicated that older and younger workers were substitutes. More recent studies by Bianchi et al (2021) and Carta et al (2021) for Italy and Mohnen (2021) for the USA focus on how delayed retirements affect younger workers. The studies by Bianchi et al (2021) and Mohnen (2021) find older and younger workers tend to be substitutes whereas Carta et al (2021) find they are complements.…”

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confidence: 99%

Forever young: where older workers keep on working

Allen

Wang

2023

Journal of Pension Economics and Finance

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This paper examines inter-industry patterns of the employment of older workers over the last 20 years to understand where employment opportunities have grown the most. The underlying premise is that firms strategically align their age mix depending on production function and labor cost parameters. The industries that had the largest increases in the percentage of older workers were those that had the broadest pension coverage and those that made the greatest use of high-tech capital. There also is evidence in 2001–07 that the percentage of older workers increased more in the industries most exposed to increased Chinese imports.

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Workforce Aging, Pension Reforms, and Firm Outcomes

Cited by 3 publications

References 26 publications

The Effect of Population Aging on Economic Growth, the Labor Force, and Productivity

The Effect of Population Aging on Economic Growth, the Labor Force, and Productivity

Dose the increasing burden of social endowment affect sustainable development of economy?

Forever young: where older workers keep on working

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