Annuity Market Imperfection, Retirement and Economic Growth

We study the effects of an annuity market imperfection on individual agents’ labour supply and retirement decisions and on the macroeconomic growth rate in an overlapping generations model with endogenous growth. We model imperfect annuities by introducing a load factor on the interest rate faced by finitely-lived agents. Our core model features age-independent wages and a constant mortality rate. In the first extension we study the implications for microeconomic decisions and macroeconomic outcomes of a hump-shaped life-cycle profile in labour productivity, whilst in the second extension we postulate a realistic mortality process. Our main findings are that the limited availability of annuities induces agents to retire early in the first two models, but later in the model with age-dependent mortality. In all cases, the general equilibrium repercussion is that economic growth is lower under imperfect annuities than with perfect annuities.annuity markets, retirement, endogenous growth, overlapping generations, demography

The Tragedy of Annuitization

We construct a tractable discrete-time overlapping generations model of a closed economy and use it to study government redistribution of accidental bequests and private annuities in general equilibrium. Individuals face longevity risk as there is a positive probability of passing away before the retirement period. We find non-pathological cases where it is better for longrun welfare to waste accidental bequests than to give them to the elderly. Next we study the introduction of a perfectly competitive life insurance market offering actuarially fair annuities. There exists a tragedy of annuitization: although full annuitization of assets is privately optimal it is not socially beneficial due to adverse general equilibrium repercussions.Longevity risk, Risk sharing, Overlapping generations, Intergenerational transfers, Annuity markets

The Tragedy of Annuitization

We construct a tractable discrete-time overlapping generations model of a closed economy and use it to study government redistribution of accidental bequests and private annuities in general equilibrium. Individuals face longevity risk as there is a positive probability of passing away before the retirement period. We find non-pathological cases where it is better for long-run welfare to waste accidental bequests than to give them to the elderly. Next we study the introduction of a perfectly competitive life insurance market offering actuarially fair annuities. There exists a tragedy of annuitization: although full annuitization of assets is privately optimal it is not socially beneficial due to adverse general equilibrium repercussions.longevity risk, risk sharing, overlapping generations, intergenerational transfers, annuity markets

No Country for Old Men: Aging Dictators and Economic Growth

This paper develops a model of the relationship between the age of a dictator and economic growth. In the model a dictator must spread the resources of the economy over his reign but faces mortality and political risk. The model shows that if the time horizon of the dictator decreases, either due to an increase of mortality risk or political risk, the economic growth rate decreases. The model predictions are supported by empirical evidence based on a three-way fixed effects model including country, year and dictator fixed effects for a sample of dictators from 116 countries. These results are robust to sample selection, the tenure of dictators, the definition of dictatorship, and a broad set of economic growth determinants

The health potential of neighborhoods:A population-wide study in the Netherlands

Background: While differences in population health across neighborhoods with different socioeconomic characteristics are well documented, health disparities across neighborhoods with similar socioeconomic characteristics are less well understood. We aimed to estimate population health inequalities, both within and between neighborhoods with similar socioeconomic status, and assessed the association of neighborhood characteristics and socioeconomic spillover effects from adjacent neighborhoods. Methods: Based on Dutch whole-population data we determined the percentage of inhabitants with good or very good self-assessed health (SAH) and the percentage of inhabitants with at least one chronic disease (CD) in 11,504 neighborhoods. Neighborhoods were classified by quintiles of a composite neighborhoods socioeconomic status score (NSES). A set of spatial models was estimated accounting for spatial effects in the dependent, independent, and error components of the model. Results: Substantial population health disparities in SAH and CD both within and between neighborhoods NSES quintiles were observed, with the largest SAH variance in the lowest NSES group. Neighborhoods adjacent to higher SES neighborhoods showed a higher SAH and a lower prevalence of CD. Projected impacts from the spatial regressions indicate how modest changes in NSES among the lowest socioeconomic neighborhoods can contribute to population health in both low- and high-SES neighborhoods. Conclusion: Population health differs substantially among neighborhoods with similar socioeconomic characteristics, which can partially be explained by a spatial socio-economic spillover effect

Moral hazard and selection for voluntary deductibles

This paper investigates whether the voluntary deductible in the Dutch health insurance system reduces moral hazard or acts only as a cost reduction tool for low-risk individuals. We use a sample of 14,089 observations, comprising 2,939 individuals over seven waves from the Longitudinal Internet Studies for the Social sciences panel for the analysis. We employ bivariate models that jointly model the choice of a deductible and health care utilization and supplement the identification with an instrumental variable strategy. The results show that the voluntary deductible reduces moral hazard, especially in the decision to visit a doctor (extensive margin) compared with the number of visits (intensive margin). In addition, a robustness test shows that selection on moral hazard is not present in this context.</p

Vocational Rehabilitation for Patients with Chronic Musculoskeletal Pain With or Without a Work Module:An Economic Evaluation

Purpose Vocational rehabilitation (VR) is a widely used intervention aimed to optimize work participation for patients on sick leave due to chronic musculoskeletal pain (CMP). Economic evaluations of care as usual VR are scarce, and may provide relevant information to guide clinical, reimbursement and policy decisions. The aim of this study was to evaluate the short-term cost-effectiveness and return on investment (ROI) of VR for patients on sick leave due to CMP with an additional work module (VR+) compared to VR without work module, from a societal and employers' perspective. Methods A retrospective longitudinal cohort study within a Dutch care as usual context was applied. Participants with CMP and decreased work participation originating from seven Dutch rehabilitation centers were included in this study. Participants underwent VR or VR+. Main data sources at baseline and discharge: Quality-adjusted life year (QALY) based on EQ-5D, intervention costs, self-reported productivity and health care utilization. Main analyses cost-effectiveness, including incremental cost-effectiveness ratio (ICER) and a cost-effectiveness acceptability curve (CEAC); and ROI analyses with use of the human capital method. Results N = 324 participants were analyzed. The results show that VR+ was cost-effective compared to VR: mean cost savings of €820 per 0.012 QALY gained. CEAC suggests probability of VR+ being cost-effective is > 0.91 for thresholds of €20.000 and higher. The mean ROI of VR+ for employers was 38%. Conclusion It was concluded that at discharge, VR+ was cost-effective compared to VR. ROI was positive for employers

The impact of the Covid-19 crisis on socioeconomic differences in physical activity behavior:Evidence from the Lifelines COVID-19 cohort study

Covid-19 and measures to contain spreading the disease have led to changed physical activity behavior. This study aims to investigate the relationship between socioeconomic status (SES) and changes in the amount of moderate to vigorous physical activity (MVPA) during the Covid-19 crisis. Using the Dutch Lifelines Covid-19 cohort study (n = 17,749), the amount of MVPA was measured at 15 time-points between March and December 2020, and compared with the amount before the Covid19 pandemic. For SES, the population was stratified in three education and income levels. Logistic regression models were used to estimate the odds ratio (OR) and confidence interval (CI) of altered MVPA for low and high SES groups, with the middle SES category as the reference group. A clear socioeconomic gradient in changes in MVPA behavior was observed. Low educated individuals had significantly higher odds (OR = 1.14; CI: 1.03-1.27) of decreasing MVPA, while the high educated had significantly lower odds of decreased MVPA (OR = 0.84, CI: 0.79-0.90). Both low education (OR = 0.87; CI: 0.77-0.98) and low income (OR = 0.85; CI 0.78-0.92) had significantly lower odds to increase MVPA, while high education (OR = 1.21, CI: 1.12-1.30) and high income (OR = 1.17; CI: 1.07-1.28) had significantly higher odds to increase MVPA. Most findings were consistent over the full research period. Socioeconomic in-equalities in MVPA have increased during the Covid-19 pandemic, even when Covid-19 containment measures were relaxed. Our findings suggest that future public health policies need to increase efforts to improve physical activity behavior with an even larger focus on low SES groups

Assessing quality of life in psychosocial and mental health disorders in children:a comprehensive overview and appraisal of generic health related quality of life measures

Background: Mental health problems often arise in childhood and adolescence and can have detrimental effects on people's quality of life (QoL). Therefore, it is of great importance for clinicians, policymakers and researchers to adequately measure QoL in children. With this review, we aim to provide an overview of existing generic measures of QoL suitable for economic evaluations in children with mental health problems. Methods: First, we undertook a meta-review of QoL instruments in which we identified all relevant instruments. Next, we performed a systematic review of the psychometric properties of the identified instruments. Lastly, the results were summarized in a decision tree. Results: This review provides an overview of these 22 generic instruments available to measure QoL in children with psychosocial and or mental health problems and their psychometric properties. A systematic search into the psychometric quality of these instruments found 195 suitable papers, of which 30 assessed psychometric quality in child and adolescent mental health. Conclusions: We found that none of the instruments was perfect for use in economic evaluation of child and adolescent mental health care as all instruments had disadvantages, ranging from lack of psychometric research, no proxy version, not being suitable for young children, no age-specific value set for children under 18, to insufficient focus on relevant domains (e.g. social and emotional domains)