Pension age and labor-force participation policies

An IIASA study for the first time estimates the trade-off between pension age and labor-force participation policies, showing that increasing labor force participation by as little as 1 or 2 percentage points could allow the pension age to be reduced by one year without increasing the burden on the working population.

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The research published in Demographic Research [1] projected the populations of European countries and applied different levels of labor force participation rates to the projections. It introduced the notion of a relative burden: the ratio of the fraction of the income of people in the labor market in 2050 that they transfer to adults outside the labor market to the same fraction in 2009.

This study has important policy implications, as without additional increases in labor force participation rates the normal pension age in many European countries would have to be raised well above 68 by 2050 to keep the burden on those working manageable.

A broad scope of applications of the new approaches to understanding and interpreting population aging introduced by World Population Program (POP) researchers was discussed by 100 demographers and sociologists from different parts of the world at the international conference, New Measures of Age and Aging, on 3-5 December in Vienna, Austria, including their economic and policy implications.

Several case studies contextualizing new measures of aging in Southeast Asia, the northern Atlantic region, Russia, and Serbia were presented at the conference, which was organized by the Wittgenstein Centre.

Refernces

[1] Scherbov S, Sanderson WC, Mamolo M (2014) Quantifying policy tradeoffs to support aging populations. Demographic Research, 30(20),579-608


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Last edited: 02 April 2015

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