Do Pension Benefits Accelerate Cognitive Decline? Evidence from Rural China
Plamen Nikolov and
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Alan Adelman: State University of New York
No 12524, IZA Discussion Papers from Institute of Labor Economics (IZA)
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: life-cycle; cognitive functioning; cognition; aging; health; mental retirement; middle-income countries; developing countries; China (search for similar items in EconPapers)
JEL-codes: J14 H55 H75 J26 J24 D91 O12 N35 O10 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-age, nep-cna, nep-hea, nep-lma, nep-neu and nep-tra
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