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Life expectancy, schooling and lifetime labor supply: the Ben-Porath mechanism revisited

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  • Pan Liu

    (Iowa State University)

Abstract

Hansen and Lønstrup [Journal of Population Economics, 2012] construct a three-period, life-cycle model to study the famed Ben-Porath mechanism and attempt to reconcile it with the empirical findings in Hazan [Econometrica, 2009]:increased life expectancy has a positive effect on schooling but a negative effect on expected lifetime labor supply. This paper shows that within the framework of Hansen and Lønstrup (2012), as life expectancy increases, expected lifetime labor supply may not decline even when labor supplies at the two end stages of life do. I fully characterize the conditions under which the model in Hansen and Lønstrup (2012) can produce the empirical findings in Hazan (2009).

Suggested Citation

  • Pan Liu, 2015. "Life expectancy, schooling and lifetime labor supply: the Ben-Porath mechanism revisited," Economics Bulletin, AccessEcon, vol. 35(1), pages 133-139.
    • Handle: RePEc:ebl:ecbull:eb-14-00810
    as

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    References listed on IDEAS

    as
    1. Matteo Cervellati & Uwe Sunde, 2013. "Life Expectancy, Schooling, and Lifetime Labor Supply: Theory and Evidence Revisited," Econometrica, Econometric Society, vol. 81(5), pages 2055-2086, September.
    2. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75, pages 352-352.
    3. Moshe Hazan, 2009. "Longevity and Lifetime Labor Supply: Evidence and Implications," Econometrica, Econometric Society, vol. 77(6), pages 1829-1863, November.
    4. Casper Hansen & Lars Lønstrup, 2012. "Can higher life expectancy induce more schooling and earlier retirement?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 25(4), pages 1249-1264, October.
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    More about this item

    Keywords

    Life expectancy; schooling; lifetime labor supply; Ben-Porath model;
    All these keywords.

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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