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Retirement and cognitive development in the Netherlands: Are the retired really inactive?

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  • de Grip, Andries
  • Dupuy, Arnaud
  • Jolles, Jelle
  • van Boxtel, Martin

Abstract

This paper uses longitudinal data to analyze the relation between retirement and cognitive development in the Netherlands. Controlling for individual fixed effects and lagged cognition, we find that retirees face lower declines in their cognitive flexibility than those who remain employed, which appears to be persistent 6 years after retirement. However, the information processing speed of low-educated retirees declines faster. The magnitude of both changes in cognition is such that retirees appear 5–6 years younger in terms of cognitive flexibility, and older in terms of information processing speed. We show that these relationships between retirement and cognitive development cannot be explained by (1) feeling relieved from routine work, (2) changes in mood, (3) changes in lifestyle, and (4) changes in blood pressure. The decline in information processing speed after retirement particularly holds for the low educated. This could increase the social costs of an aging society.

Suggested Citation

  • de Grip, Andries & Dupuy, Arnaud & Jolles, Jelle & van Boxtel, Martin, 2015. "Retirement and cognitive development in the Netherlands: Are the retired really inactive?," Economics & Human Biology, Elsevier, vol. 19(C), pages 157-169.
    • Handle: RePEc:eee:ehbiol:v:19:y:2015:i:c:p:157-169
    DOI: 10.1016/j.ehb.2015.08.004
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    3. Plamen Nikolov & Md Shahadath Hossain, 2020. "Do Pension Benefits Accelerate Cognitive Decline in Late Adulthood? Evidence from Rural China," Papers 2007.05884, arXiv.org, revised Dec 2022.
    4. Olivera, Javier & Andreoli, Francesco & Leist, Anja K. & Chauvel, Louis, 2018. "Inequality in old age cognition across the world," Economics & Human Biology, Elsevier, vol. 29(C), pages 179-188.
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    7. Nikolov, Plamen & Adelman, Alan, 2019. "Do Pension Benefits Accelerate Cognitive Decline? Evidence from Rural China," IZA Discussion Papers 12524, Institute of Labor Economics (IZA).
    8. Koryu Sato & Haruko Noguchi, 2023. "Impact of Retirement on Health: Evidence from 35 Countries," Working Papers 2301, Waseda University, Faculty of Political Science and Economics.
    9. Lei, Xiaoyan & Liu, Hong, 2018. "Gender difference in the impact of retirement on cognitive abilities: Evidence from urban China," Journal of Comparative Economics, Elsevier, vol. 46(4), pages 1425-1446.
    10. Zhao, Yuejun & Inder, Brett & Kim, Jun Sung, 2021. "Spousal bereavement and the cognitive health of older adults in the US: New insights on channels, single items, and subjective evidence," Economics & Human Biology, Elsevier, vol. 43(C).
    11. Nikolov, Plamen & Adelman, Alan, 2020. "Pension Policies, Retirement and Human Capital Depreciation in Late Adulthood," IZA Discussion Papers 13932, Institute of Labor Economics (IZA).
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    More about this item

    Keywords

    Cognitive decline; Labor market activity; Retirement;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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