Longer Life, Higher Welfare?

Posted: 24 Jun 2008

See all articles by Michael Grimm

Michael Grimm

Erasmus University Rotterdam; University of Passau; IZA; DIW Berlin

Kenneth Harttgen

University of Zurich

Date Written: April 2008

Abstract

Whereas life expectancy continues to increase in most industrialized countries, many developing and transition countries are today confronted with decreases in life expectancy. Usual measures employed to compare welfare over time and space fail to deal with such demographic change and may lead to the so-called repugnant conclusion that lower life expectancy involves higher welfare per capita. We illustrate this type of transmission channel using various welfare criteria and reference populations. We also consider feed-back effects from the demography on the economy using a neo-classical growth model. We show that the repugnant conclusion can be avoided if we choose a lifetime welfare measure instead of a period (or snapshot) welfare measure. All concepts are illustrated empirically using a small sample of developed and developing countries.

JEL Classification: D63, I31, J11

Suggested Citation

Grimm, Michael and Harttgen, Kenneth, Longer Life, Higher Welfare? (April 2008). Oxford Economic Papers, Vol. 60, Issue 2, pp. 193-211, 2008. Available at SSRN: https://ssrn.com/abstract=1150604 or http://dx.doi.org/gpm025

Michael Grimm (Contact Author)

Erasmus University Rotterdam ( email )

Kortenaerkade 12
P.O. Box 29776
The Hague, 2502LT
Netherlands

HOME PAGE: http://www.iss.nl

University of Passau ( email )

Innstrasse 29
Passau, 94032
Germany

HOME PAGE: http://www.wiwi.uni-passau.de/grimm.html

IZA ( email )

P.O. Box 7240
Bonn, D-53072
Germany

DIW Berlin ( email )

Mohrenstraße 58
Berlin, 10117
Germany

Kenneth Harttgen

University of Zurich ( email )

Rämistrasse 71
Zürich, CH-8006
Switzerland

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