Measuring Subjective Survival Expectations:Do Response Scales Matter?

This paper analyzes the test-retest reliability of subjective survival expectations that are elicited on two widely used response scales: an 11-point scale from 0 to 10 and a full percentage scale from 0 to 100. We compare responses of the same individuals in two surveys fielded in the same month. Reliability is evaluated both at the level of reported probabilities and through a model that relates expectations to socio-demographic variables. Test-retest correlations of survival probabilities are between 0.5 and 0.7, similar to subjective well-being. Only 20% of probabilities are equal across surveys, but up to 61–77% are consistent once we account for rounding. Both scales perform similarly in terms of response rates, internal consistency and fifty-fifty answers. Models that analyze all probabilities jointly reveal similar associations between most covariates and the hazard of death in test and retest datasets. Moreover, expectations are persistent at the level of the individual and this unobserved heterogeneity is strongly correlated across surveys (r ≈  0.8-0.9). Finally, we use a calibrated life cycle model to map survival expectations into wealth and labor supply. Wealth accumulation is sensitive to expectations and correcting for rounding substantially improves reliability of simulated wealth profiles. Taken together this evidence suggests that the two elicitation scales yield reliable measures of expectations, especially when aggregated into individual-level subjective survival curves

Common currency and economic integration in mercosur

Latin America has a long history of attempts to achieve regional integration, yetsuccess has been modest. This paper contends that this is essentially due not so much toprotectionist practices in the various countries, but to the lack of a common currency, or, atleast, of a tightly managed exchange rate band. We reviewed the optimum currency areacriteria that indicate it is prudent to increase economic integration before attempting toestablish exchange rates coordination. Yet, we show that in the Mercosul there are already theminimal requirements to work on this direction. Diminishing exchange rate instability couldencourage trade and investment flows across Latin American economies. We also performed asimplified exercise to understand how feasible would be the efforts to achieve exchange rateparity stability in the two larger economies in the region (Brazil and Argentina) and stepforward toward adopting a common currency.

Why foreign savings fail to cause growth

Este artigo é uma formalização da crítica à estratégia do crescimento com poupança externa que um de seus autores vem sendo fazendo nos últimos anos. Apesar dos países de renda média serem pobres de capital, os déficits em conta corrente (poupança externa), financiado seja por empréstimos ou por investimentos externos diretos, não irá aumentar a taxa de acumulação de capital ou terá pouco impacto sobre ela, uma vez que os déficits de conta corrente estarão associados taxas de câmbio apreciadas, ordenados e salários aumentados artificialmente e altos níveis de consumo. Consequentemente, a taxa de substituição da poupança externa pela interna será relativamente alta, e o país será obrigado não a investir e crescer, mas a consumir. Apenas quando há grandes oportunidades de investimento, estimuladas por uma ampla diferença entre a taxa de lucro esperada e a taxa de juros de longo prazo, a propensão marginal ao consumo diminuirá suficientemente, a ponto de o lucro adicional originário do fluxo de capital estrangeiro ser usado para investimento, ao invés de para consumo. Neste caso especial, a taxa de substituição de poupança externa pela interna tenderá a ser menor e a poupança interna contribuirá positivamente para o crescimento

Heterogeneous Default Effects on Retirement Saving:Sledgehammers or Precision Instruments

This paper uses a randomized experiment in a representative sample from the Dutch population to investigate the effect of various defaults on retirement saving. In light of the Dutch pension system, with high contributions that afford generous income replace- ment but no flexibility other than the timing of retirement, we consider defaults that encourage less saving as well as more. The aggregate effects of defaults at deviations from the status quo are symmetric and large: they increase the fraction that either suspends or doubles premium payments for three years by 22 percentage points (pp) on a base of less than 10%. The status quo default is less powerful, raising the fraction by 6–13pp from a baseline around 60%. Rich survey data on demographics and prefer- ences matched with administrative records of wealth and forecasted pensions indicate that the different default effects are driven by different groups. A default of increased saving disproportionately affects those with self-control issues, but has a smaller effect on individuals prone to procrastination. Moreover, this is the only default that inter- acts with variables related to preparedness for retirement, with a larger effect on those with high housing wealth and high adequate expenditure goals. The saving reduction default affects women more strongly and has a weaker effect on university graduates

Beyond the Standard models of particle physics and cosmology

The modern Standard cosmological model of inflationary Unvierse and baryosynthesis deeply involves particle theory beyond the Standard model (BSM). Inevitably, models of BSM physics lead to cosmological scenarios beyond the Standard cosmological paradigm. Scenarios of dark atom cosmology in the context of puzzles of direct and indirect dark matter searches, of clusters of massive primordial black holes as the source of gravitational wave signals and of antimatter globular cluster as the source of cosmic antihelium are discussed.Comment: Prepared for Proceedings of XXI Bled Workshop "What comes beyond the Standard models?

Cutting one’s coat according to one’s cloth:How did the Great Recession affect retirement resources and expenditure goals?

Hervorming Sociale Regelgevin

Preferences for Long-Term Care Services: Bequests, Informal Care and Health Expectations

This paper studies people’s preferences for formal long-term care services provided at home, and examines how long-term care preferences relate to saving motives, such as the relative importance and type of the bequest motive, the availability of informal care, and health expectations. To elicit long-term care preferences, we use a stated choice experiment fielded in the Dutch LISS panel in which we ask people to choose between long-term care insurance plans offering in-kind benefits provided at home that differ in generosity. The results show that there is viable demand for insurance that covers long-term care services at home. Long-term care services represent a different value for different people depending on individual characteristics and expectations about long-term care needs. Having children, access to informal care, and a strong strategic-bequest motive reduces the willingness to pay for formal long-term care services. These results contribute to the understanding of saving behavior after retirement and design of long-term care insurance policies