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The effects of the raising-the-official-pension-age policy in an overlapping generations economy

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  • Miyazaki, Koichi

Abstract

This paper studies how economic variables are affected by raising the official pension age. Although it is said that such a policy increases output, this paper shows that such a statement is not necessarily true. Moreover, the paper finds that the social security benefit can decrease, which implies that it might be impossible to sustain the same level of benefit only by such a policy.

Suggested Citation

  • Miyazaki, Koichi, 2014. "The effects of the raising-the-official-pension-age policy in an overlapping generations economy," Economics Letters, Elsevier, vol. 123(3), pages 329-332.
    • Handle: RePEc:eee:ecolet:v:123:y:2014:i:3:p:329-332
    DOI: 10.1016/j.econlet.2014.03.011
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    References listed on IDEAS

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    1. Hu, Sheng Cheng, 1979. "Social Security, the Supply of Labor, and Capital Accumulation," American Economic Review, American Economic Association, vol. 69(3), pages 274-283, June.
    2. Sala-i-Martin, Xavier X, 1996. "A Positive Theory of Social Security," Journal of Economic Growth, Springer, vol. 1(2), pages 277-304, June.
    3. Staubli, Stefan & Zweimüller, Josef, 2013. "Does raising the early retirement age increase employment of older workers?," Journal of Public Economics, Elsevier, vol. 108(C), pages 17-32.
    4. Fanti, Luciano & Gori, Luca, 2010. "Increasing PAYG pension benefits and reducing contribution rates," Economics Letters, Elsevier, vol. 107(2), pages 81-84, May.
    5. Conde-Ruiz, J. Ignacio & Galasso, Vincenzo, 2004. "The macroeconomics of early retirement," Journal of Public Economics, Elsevier, vol. 88(9-10), pages 1849-1869, August.
    6. Zhang, Jie & Zhang, Junsen, 2009. "Longevity, Retirement, And Capital Accumulation In A Recursive Model With An Application To Mandatory Retirement," Macroeconomic Dynamics, Cambridge University Press, vol. 13(3), pages 327-348, June.
    7. Feldstein, Martin S, 1974. "Social Security, Induced Retirement, and Aggregate Capital Accumulation," Journal of Political Economy, University of Chicago Press, vol. 82(5), pages 905-926, Sept./Oct.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Partha Sen, 2020. "Postponing Retirement and Social Security in a Two Sector Model," CESifo Working Paper Series 8751, CESifo.
    2. Cipriani, Giam Pietro & Pascucci, Francesco, 2020. "Pension policies in a model with endogenous fertility," Journal of Pension Economics and Finance, Cambridge University Press, vol. 19(1), pages 109-125, January.
    3. Miyazaki, Koichi, 2014. "Optimal pay-as-you-go social security when retirement is endogenous and labor productivity depreciates," MPRA Paper 61166, University Library of Munich, Germany.
    4. Hung-ju Chen & Koichi Miyazaki, 2020. "Labor productivity, labor supply of the old, and economic growth," Economics Bulletin, AccessEcon, vol. 40(1), pages 277-285.
    5. Hirono, Makoto & Mino, Kazuo, 2019. "Pension, Retirement, and Growth in the Presence Heterogeneous Elderly," MPRA Paper 98096, University Library of Munich, Germany.
    6. Davide Bazzana, 2020. "Ageing population and pension system sustainability: reforms and redistributive implications," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 37(3), pages 971-992, October.
    7. Zhen Hu & James Yang, 2021. "Does Delayed Retirement Crowd Out Workforce Welfare? Evidence in China," SAGE Open, , vol. 11(4), pages 21582440211, November.
    8. Zheng Shen & James Yang, 2021. "A Simulation Study of the Effect of Delayed Retirement on Welfare of the Elderly: Evidence from China," SAGE Open, , vol. 11(2), pages 21582440211, June.
    9. Miyazaki, Koichi, 2019. "Optimal Pay-As-You-Go Social Security With Endogenous Retirement," Macroeconomic Dynamics, Cambridge University Press, vol. 23(2), pages 870-887, March.
    10. Chen, Hung-Ju, 2016. "Fertility, Retirement Age, and PAYG Pensions," MPRA Paper 69819, University Library of Munich, Germany.
    11. Cavalli, F. & Chen, H.-J. & Li, M.-C. & Naimzada, A. & Pecora, N., 2023. "Heterogeneous expectations and equilibria selection in an evolutionary overlapping generations model," Journal of Mathematical Economics, Elsevier, vol. 104(C).
    12. Chen, Hung-Ju, 2015. "Fertility and PAYG Pensions in an Overlapping Generations Model with Endogenous Retirement," MPRA Paper 68020, University Library of Munich, Germany.
    13. van Dalen, Hendrik Peter & Henkens, C.J.I.M. & Oude Mulders, Jaap, 2019. "Increasing the public pension age : Employers’ concerns and policy preferences," Other publications TiSEM aeddd7fb-7cbc-4853-b7a7-c, Tilburg University, School of Economics and Management.
    14. Tian, Ying & Ma, Haitao & Tunio, Fayaz Hussain, 2024. "Evaluating the impact of social security contribution rate, delayed retirement age, and employment rate on pension replacement rate: An overlapping generation (OLG) model analysis," Research in Economics, Elsevier, vol. 78(2).
    15. Hirono, Makoto & Mino, Kazuo, 2020. "Pension Reforms, Population Aging, and Retirement Decision of the Elderly in a Neoclassical Growth Model," MPRA Paper 102467, University Library of Munich, Germany.

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    More about this item

    Keywords

    Official pension age; Output per efficiency unit of labor; Aggregate output; Per unit of time social security benefit;
    All these keywords.

    JEL classification:

    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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