Longevity and Redistribution in the German Pension System
AbstractThere are theoretical foundations which allow hypothesizing on a positive association of life expectancy or retirement age with income. If both cannot be falsified, the relationship of income and the internal rate of return of a public pension system is not straight forward. By application of a partially linear model to micro data from the German public pension system, it is found that neither life expectancy, nor retirement age is monotonously increasing in income, as measured in benefit claims. The relation of benefit claims and duration under the benefit spell (which determines the rate of return) depends on the set of covariates. Including pensions for disabled individuals, three out of four specifications exhibit a duration decreasing in benefit claims.
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Bibliographic InfoPaper provided by Research Group Heterogeneous Labor, University of Konstanz/ZEW Mannheim in its series Working Papers of the Research Group Heterogenous Labor with number 06-10.
Length: 41 pages
Date of creation: 25 Apr 2006
Date of revision:
Public Pension System ; Life Expectancy ; Redistribution ; Partially Linear Model;
Find related papers by JEL classification:
- H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- I12 - Health, Education, and Welfare - - Health - - - Health Production
- H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
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