Demographic Change, Social Security Systems, and Savings

41 Pages Posted: 27 Oct 2006 Last revised: 28 Jun 2010

See all articles by David E. Bloom

David E. Bloom

Harvard University - T.H. Chan School of Public Health; National Bureau of Economic Research (NBER)

David Canning

Harvard University - T.H. Chan School of Public Health

Rick Mansfield

Yale University

Michael J. Moore

University of Virginia - Darden School of Business; National Bureau of Economic Research (NBER)

Date Written: October 2006

Abstract

In theory, improvements in healthy life expectancy should generate increases in the average age of retirement, with little effect on savings rates. In many countries, however, retirement incentives in social security programs prevent retirement ages from keeping pace with changes in life expectancy, leading to an increased need for life-cycle savings. Analyzing a cross-country panel of macroeconomic data, we find that increased longevity raises aggregate savings rates in countries with universal pension coverage and retirement incentives, though the effect disappears in countries with pay-as-you-go systems and high replacement rates.

Suggested Citation

Bloom, David E. and Canning, David and Mansfield, Rick and Moore, Michael J., Demographic Change, Social Security Systems, and Savings (October 2006). NBER Working Paper No. w12621, Available at SSRN: https://ssrn.com/abstract=938414

David E. Bloom (Contact Author)

Harvard University - T.H. Chan School of Public Health ( email )

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National Bureau of Economic Research (NBER)

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David Canning

Harvard University - T.H. Chan School of Public Health ( email )

677 Huntington Avenue
Boston, MA MA 02115
United States

Rick Mansfield

Yale University ( email )

New Haven, CT 06520
United States

Michael J. Moore

University of Virginia - Darden School of Business ( email )

Box 6550
Faculty 121
Charlottesville, VA 22906-6550
United States

HOME PAGE: http://www.darden.virginia.edu/faculty/mooremi.htm

National Bureau of Economic Research (NBER)

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