A mixed blessing of lifespan heterogeneity

Emin Gahramanov and Xueli Tang

Journal of the Japanese and International Economies, 2013, vol. 29, issue C, 142-153

Abstract: Human mortality data reveal that life expectancy in industrialized countries has been converging to a common value. Yet, significant variations in the distributions of adult life-table ages at death among some developed countries have also been observed. This paper, largely motivated by Japan’s mortality data, presents a general equilibrium, overlapping-generations model that assesses the welfare effects of the mean-preserving declines in the variance of the distribution of adult ages at death. Our quantitative exercise reveals that for a given value of the economy-wide life expectancy, the individual welfare effects due to switching from high to low-variance steady states are length of life-dependent, quite sensitive to the average economy-wide retirement age, and strongly influenced by associated changes in the labor supply, factor prices, and lifetime earnings.

Keywords: General equilibrium; Lifespan heterogeneity; Life expectancy; Variance in adult age at death; Compensating variation (search for similar items in EconPapers)
JEL-codes: D91 E20 J11 J17 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jjieco:v:29:y:2013:i:c:p:142-153

DOI: 10.1016/j.jjie.2013.07.001

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