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Public Pensions and Elderly Mortality in Canada: Comparing Means tested and Universal Eligibility, 1921 – 1966

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Author Info
Herbert Emery
Jesse Matheson

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Abstract

We investigate the impact of three public pension programs on the mortality rates of recipient age groups in Canada. The Old Age Pension (OAP), introduced in 1927 for Canadians over age 70, and Old Age Assistance (OAA), implemented in 1952 for Canadians aged 65–69, were means tested programs while Old Age Security (OAS), introduced in 1952 for Canadians over age 70, was a universal plan. Our data consist of age-specific mortality rates and pension information, by province, for the period 1921–1966. The three dimensional feature of this panel allows us to exploit variation in policy implementation dates across provinces, and changes in income and age group eligibility. We find that the implementation of all three pension programs resulted in statistically significant reductions in recipient age group mortality rates and that the effect of the federal universal OAS of 1952 was twice as large as either of the means tested plans. However, the number of lives extended with the universal OAS was small and the estimated cost per life extended large.

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Paper provided by Department of Economics, University of Calgary in its series Working Papers with number 2008-24.

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Date of creation: 14 Jan 2008
Date of revision: 14 Jan 2008
Handle: RePEc:clg:wpaper:2008-24

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Find related papers by JEL classification:
H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
I32 - Health, Education, and Welfare - - Welfare and Poverty - - - Measurement and Analysis of Poverty
I38 - Health, Education, and Welfare - - Welfare and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped
N32 - Economic History - - Labor and Consumers, Demography, Education, Income, and Wealth - - - U.S.; Canada: 1913-

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  1. Andreea Balan-Cohen, 2008. "Healthy, Wealthy, and Wise? The Impact of the Old Age Assistance Program on Elderly Mortality in the United States," Discussion Papers Series, Department of Economics, Tufts University 0719, Department of Economics, Tufts University. [Downloadable!]
  2. W. Kip Viscusi, 1994. "Mortality Effects of Regulatory Costs and Policy Evaluation Criteria," RAND Journal of Economics, The RAND Corporation, vol. 25(1), pages 94-109, Spring. [Downloadable!] (restricted)
  3. David Cutler & Angus Deaton & Adriana Lleras-Muney, 2006. "The Determinants of Mortality," Journal of Economic Perspectives, American Economic Association, vol. 20(3), pages 97-120, Summer.
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  4. Christopher J. Ruhm, 2000. "Are Recessions Good For Your Health?," The Quarterly Journal of Economics, MIT Press, vol. 115(2), pages 617-650, May. [Downloadable!] (restricted)
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  5. Chapman, Kenneth S & Hariharan, Govind, 1996. "Do Poor People Have a Stronger Relationship between Income and Mortality Than the Rich? Implications of Panel Data for Health-Health Analysis," Journal of Risk and Uncertainty, Springer, vol. 12(1), pages 51-63, January.
  6. Audrey Laporte, 2004. "Do economic cycles have a permanent effect on population health? Revisiting the Brenner hypothesis," Health Economics, John Wiley & Sons, Ltd., vol. 13(8), pages 767-779. [Downloadable!]
  7. Smith, J-P & Kington, R, 1997. "Demographic and Economic Correlates of Health in Old Age," Papers 97-06, RAND - Reprint Series.
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  8. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2002. "How Much Should We Trust Differences-in-Differences Estimates?," NBER Working Papers 8841, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  9. Price V. Fishback & Michael R. Haines & Shawn Kantor, 2007. "Births, Deaths, and New Deal Relief during the Great Depression," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 1-14, 01. [Downloadable!] (restricted)
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  10. Stephen E Snyder & William N Evans, 2006. "The Effect of Income on Mortality: Evidence from the Social Security Notch," The Review of Economics and Statistics, MIT Press, vol. 88(3), pages 482-495, 08. [Downloadable!] (restricted)
  11. Blundell, Richard & Fry, Vanessa & Walker, Ian, 1987. "Modelling the Take-up of Means-tested Benefits: the Case of Housing Benefits in the United Kingdom," Economic Journal, Royal Economic Society, vol. 98(390), pages 58-74, Supplemen. [Downloadable!] (restricted)
  12. Chapman, Kenneth S & Hariharan, Govind, 1994. "Controlling for Causality in the Link from Income to Mortality," Journal of Risk and Uncertainty, Springer, vol. 8(1), pages 85-93, January.
  13. Robin Boadway, 1998. "Redistributing Smarter: Self-Selection, Targeting and Non-Conventional Policy Instruments," Canadian Public Policy, University of Toronto Press, vol. 24(3), pages 365-369, September. [Downloadable!] (restricted)
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