Mortality transition and differential incentives for early retirement
Many studies specify human mortality patterns parametrically, with a parameter change affecting mortality rates at different ages simultaneously. Motivated by the stylized fact that a mortality decline affects primarily younger people in the early phase of mortality transition but mainly older people in the later phase, we study how a mortality change at an arbitrary age affects optimal retirement age. Using the Volterra derivative for a functional, we show that mortality reductions at older ages delay retirement unambiguously, but that mortality reductions at younger ages may lead to earlier retirement due to a substantial increase in the individual's expected lifetime human wealth.
|Date of creation:||Jan 2012|
|Date of revision:|
|Publication status:||Published, Journal of Economic Theory, 2012, 147, 1, 261-283|
|Note:||View the original document on HAL open archive server: http://hal.archives-ouvertes.fr/hal-00659868|
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