Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age

Detalhes bibliográficos
Autor(a) principal: Bravo, Jorge M.
Data de Publicação: 2021
Outros Autores: Ayuso, Mercedes, Holzmann, Robert, Palmer, Edward
Tipo de documento: Artigo
Idioma: eng
Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
Texto Completo: http://hdl.handle.net/10362/127809
Resumo: Bravo, J. M., Ayuso, M., Holzmann, R., & Palmer, E. (2021). Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age. (pp. 1-41). (CESifo Working Papers; No. 9408). Munich Society for the Promotion of Economic Research ‐ CESifo GmbH. https://ssrn.com/abstract=3961911
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spelling Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement AgeRetirement ageActuarial fairnessIntergenerational neutralityPensionsBayesian Model EnsemblePopulation ageingSDG 1 - No PovertySDG 10 - Reduced InequalitiesSDG 3 - Good Health and Well-beingBravo, J. M., Ayuso, M., Holzmann, R., & Palmer, E. (2021). Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age. (pp. 1-41). (CESifo Working Papers; No. 9408). Munich Society for the Promotion of Economic Research ‐ CESifo GmbH. https://ssrn.com/abstract=3961911Continuous longevity improvements and population ageing have led countries to modify national public pension schemes by increasing the standard and early retirement ages in a discretionary, scheduled, or automatic way, and by making it harder for people to retire prematurely. To this end, countries have adopted alternative retirement age strategies, but our analyses show that the measures taken are often poorly designed and consequently misaligned with the pension scheme’s ultimate goals. In addition, our analyses demonstrate that countries risk falling short of their goals given their use of projection methods that underestimate life expectancy. This paper discusses how to implement automatic indexation of the retirement age to life expectancy developments while respecting the principles of intergenerational actuarial fairness and neutrality among generations. We show that in policy designs in which extended working lives translate into additional pension entitlements, the pension age must be automatically updated to keep the period in retirement constant. Alternatively, policy designs that pursue a fixed replacement rate are consistent with retirement age policies targeting a constant balance between active years in the workforce and years in retirement. The empirical strategy employed to project the relevant cohort life expectancy uses a Bayesian Model Ensemble approach to stochastic mortality modelling to generate forecasts of intergenerationally and actuarially fair pension ages for 23 countries and regions from 2000 to 2050. The empirical results show that the pension age increases needed to accommodate the effect of longevity developments on pay-as-you-go equilibrium and to reinstate equity between generations are sizeable and well beyond those employed and/or legislated in most countries. A new wave of pension reforms may be at the doorsteps.Munich Society for the Promotion of Economic Research ‐ CESifo GmbHInformation Management Research Center (MagIC) - NOVA Information Management SchoolNOVA Information Management School (NOVA IMS)RUNBravo, Jorge M.Ayuso, MercedesHolzmann, RobertPalmer, Edward2021-11-16T23:26:10Z2021-11-122021-11-12T00:00:00Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/article44application/pdfhttp://hdl.handle.net/10362/127809eng2364-1428PURE: 34889350info:eu-repo/semantics/openAccessreponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãoinstacron:RCAAP2024-03-11T05:07:39Zoai:run.unl.pt:10362/127809Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireopendoar:71602024-03-20T03:46:13.095037Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãofalse
dc.title.none.fl_str_mv Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age
title Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age
spellingShingle Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age
Bravo, Jorge M.
Retirement age
Actuarial fairness
Intergenerational neutrality
Pensions
Bayesian Model Ensemble
Population ageing
SDG 1 - No Poverty
SDG 10 - Reduced Inequalities
SDG 3 - Good Health and Well-being
title_short Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age
title_full Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age
title_fullStr Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age
title_full_unstemmed Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age
title_sort Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age
author Bravo, Jorge M.
author_facet Bravo, Jorge M.
Ayuso, Mercedes
Holzmann, Robert
Palmer, Edward
author_role author
author2 Ayuso, Mercedes
Holzmann, Robert
Palmer, Edward
author2_role author
author
author
dc.contributor.none.fl_str_mv Information Management Research Center (MagIC) - NOVA Information Management School
NOVA Information Management School (NOVA IMS)
RUN
dc.contributor.author.fl_str_mv Bravo, Jorge M.
Ayuso, Mercedes
Holzmann, Robert
Palmer, Edward
dc.subject.por.fl_str_mv Retirement age
Actuarial fairness
Intergenerational neutrality
Pensions
Bayesian Model Ensemble
Population ageing
SDG 1 - No Poverty
SDG 10 - Reduced Inequalities
SDG 3 - Good Health and Well-being
topic Retirement age
Actuarial fairness
Intergenerational neutrality
Pensions
Bayesian Model Ensemble
Population ageing
SDG 1 - No Poverty
SDG 10 - Reduced Inequalities
SDG 3 - Good Health and Well-being
description Bravo, J. M., Ayuso, M., Holzmann, R., & Palmer, E. (2021). Intergenerational Actuarial Fairness When Longevity Increases: Amending the Retirement Age. (pp. 1-41). (CESifo Working Papers; No. 9408). Munich Society for the Promotion of Economic Research ‐ CESifo GmbH. https://ssrn.com/abstract=3961911
publishDate 2021
dc.date.none.fl_str_mv 2021-11-16T23:26:10Z
2021-11-12
2021-11-12T00:00:00Z
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
format article
status_str publishedVersion
dc.identifier.uri.fl_str_mv http://hdl.handle.net/10362/127809
url http://hdl.handle.net/10362/127809
dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv 2364-1428
PURE: 34889350
dc.rights.driver.fl_str_mv info:eu-repo/semantics/openAccess
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv 44
application/pdf
dc.publisher.none.fl_str_mv Munich Society for the Promotion of Economic Research ‐ CESifo GmbH
publisher.none.fl_str_mv Munich Society for the Promotion of Economic Research ‐ CESifo GmbH
dc.source.none.fl_str_mv reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação
instacron:RCAAP
instname_str Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação
instacron_str RCAAP
institution RCAAP
reponame_str Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
collection Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
repository.name.fl_str_mv Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação
repository.mail.fl_str_mv
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