Disentangling the Age, Period, and Cohort Effects Using a Modeling Approach

Tinbergen Institute Working Paper No. 2002-120/3

39 Pages Posted: 5 Feb 2003

See all articles by France Portrait

France Portrait

VU University Amsterdam - Department of Economics

Rob Alessie

Utrecht University - School of Economics; VU University Amsterdam - Department of Economics

Dorly Deeg

Vrije Universiteit Amsterdam, School of Business and Economics

Date Written: December 2002

Abstract

Disentangling age, period, and cohort effects in explaining health trends is crucial to assess future prevalences of health disorders. The identification problem - age, period, and cohort effects are perfectly linearly related - is tackled by modeling cohort and period effects using lifetime macro-indicators. This approach - innovative in analyses on health trends - handles the identification problem and explains mechanisms underlying cohort and period effects. The modeling approach is compared with graphical and two-factors methods. The methods are applied on Dutch trends in functional limitations using data from the Longitudinal Aging Study Amsterdam. We argue that the modeling approach is a highly appropriate alternative. We find that the prevalence of functional limitations increases in the nineteen-nineties due to adverse cohort and period effects. Cohort effects are explained by hygienic and socio-economic conditions during childhood and period effects by restrictions in availability of health care services.

Keywords: Age-Period-Cohort Analysis, Trends in Functional limitations, Aging

JEL Classification: I1, C4

Suggested Citation

Portrait, France and Alessie, R.J.M. (Rob) and Deeg, Dorly, Disentangling the Age, Period, and Cohort Effects Using a Modeling Approach (December 2002). Tinbergen Institute Working Paper No. 2002-120/3. Available at SSRN: https://ssrn.com/abstract=360780 or http://dx.doi.org/10.2139/ssrn.360780

France Portrait (Contact Author)

VU University Amsterdam - Department of Economics ( email )

De Boelelaan 1105
1081 HV Amsterdam
Netherlands
+31 20 444 6155 (Phone)

R.J.M. (Rob) Alessie

Utrecht University - School of Economics ( email )

Kriekenpitplein 21-22
Adam Smith Building
Utrecht, 3584 EC
Netherlands
31 30 253 9814 (Phone)
31 30 253 7373 (Fax)

HOME PAGE: http://www2.econ.uu.nl/users/alessie/

VU University Amsterdam - Department of Economics ( email )

De Boelelaan 1105
1081 HV Amsterdam
Netherlands
+31 20 444 6047 (Phone)
+31 20 444 6005 (Fax)

Dorly Deeg

Vrije Universiteit Amsterdam, School of Business and Economics ( email )

De Boelelaan 1105
Amsterdam, 1081HV
Netherlands

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