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Mortality Decline and Aggregate Wealth Accumulation

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  • Bommier, Antoine

Abstract

The paper discusses the impact of longevity extension on aggregate wealth accumulation, accounting for changes in individual behaviors as well as changes in population age structure. It departs from the standard literature by adopting a formulation of individual preferences that accounts for temporal risk aversion. Human impatience is then closely related to mortality rates and aggregate wealth accumulation appears to be much more sensitive to demographic factors than with the traditional approach. Illustrations are provided using historical mortality data from different countries.

Suggested Citation

  • Bommier, Antoine, 2009. "Mortality Decline and Aggregate Wealth Accumulation," TSE Working Papers 09-050, Toulouse School of Economics (TSE).
  • Handle: RePEc:tse:wpaper:22173
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    References listed on IDEAS

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    1. R. Anton Braun & Daisuke Ikeda & Douglas H. Joines, 2006. "Saving and interest rates in Japan: Why they have fallen and why they will remain low," Proceedings, Federal Reserve Bank of San Francisco, issue Jun.
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    3. Ronald Lee & Andrew Mason & Timothy Miller, 2003. "Saving, Wealth and the Transition from Transfers to Individual Responsibility: The Cases of Taiwan and the United States," Scandinavian Journal of Economics, Wiley Blackwell, vol. 105(3), pages 339-358, September.
    4. Richard Blundell & Martin Browning & Costas Meghir, 1994. "Consumer Demand and the Life-Cycle Allocation of Household Expenditures," Review of Economic Studies, Oxford University Press, vol. 61(1), pages 57-80.
    5. Kihlstrom, Richard E. & Mirman, Leonard J., 1974. "Risk aversion with many commodities," Journal of Economic Theory, Elsevier, vol. 8(3), pages 361-388, July.
    6. Yoram Halevy, 2008. "Strotz Meets Allais: Diminishing Impatience and the Certainty Effect," American Economic Review, American Economic Association, vol. 98(3), pages 1145-1162, June.
    7. David E. Bloom & David Canning & Bryan Graham, 2003. "Longevity and Life-cycle Savings," Scandinavian Journal of Economics, Wiley Blackwell, vol. 105(3), pages 319-338, September.
    8. Charles Yuji HORIOKA & Wataru SUZUKI & Tatsuo HATTA, 2007. "Aging, Savings, and Public Pensions in Japan," Asian Economic Policy Review, Japan Center for Economic Research, vol. 2(2), pages 303-319.
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    10. Antoine Bommier, 2006. "Uncertain Lifetime And Intertemporal Choice: Risk Aversion As A Rationale For Time Discounting," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 47(4), pages 1223-1246, November.
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    14. repec:reg:rpubli:282 is not listed on IDEAS
    15. Antoine Bommier, 2008. "Rational Impatience ?," Working Papers hal-00441880, HAL.
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    More about this item

    Keywords

    longevity; life cycle savings; wealth accumulation;

    JEL classification:

    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • J1 - Labor and Demographic Economics - - Demographic Economics

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