Do Pension Benefits Accelerate Cognitive Decline? Evidence from Rural China

Plamen Nikolov and Alan Adelman ()
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Alan Adelman: State University of New York

No 12524, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Higher life expectancy and rapidly aging populations have led to the introduction of pension programs in developing countries in the last two decades. Using the introduction of a new public policy in China, we estimate the effects of pension benefits on individual cognition, measured by episodic memory and intact mental status, among individuals ages 60 and above. We find large and significant negative effects of the provision of pension benefits on cognitive functioning among the elderly. We find the largest effect of the program on delayed recall, a measure implicated in neurobiological research as an important predictor of the onset of dementia. We show that the program leads to more negative impacts among the female sample. Our findings support the mental retirement hypothesis that decreased mental activity results in atrophy of cognitive skills. We show that retirement plays a significant role in explaining cognitive decline at older ages.

Keywords: middle-income countries; mental retirement; health; aging; cognition; cognitive functioning; life-cycle; developing countries; China (search for similar items in EconPapers)
JEL-codes: D91 H55 H75 J14 J24 J26 N35 O10 O12 (search for similar items in EconPapers)
Pages: 49 pages
Date: 2019-08
New Economics Papers: this item is included in nep-age, nep-cna, nep-hea, nep-lma, nep-neu and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Published - updated version published as DP15742 . (published in: Journal of Economic Behavior & Organization, 2023, 205, 594 - 617).

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