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Title:Uncertain longevity and investment in education PDF Logo
Authors:Sheshinski, Eytan
Issue Date:2009
Series/Report no.:CESifo working paper 2784
Abstract:It has been argued that increased life expectancy raises the rate of return on education, causing a rise in the investment in education followed by an increase in lifetime labor supply. Empirical evidence of these relations is rather weak. Building on a lifecycle model with uncertain longevity, this paper shows that increased life expectancy does not suffice to warrant the above hypotheses. We provide assumptions about the change in survival probabilities, specifically about the age dependence of hazard rates, which determine individuals' behavioral response w.r.t. education, work and age of retirement. Comparison is made between the case when individuals have access to a competitive annuity market and the case of no insurance.
Subjects:longevity
survival functions
education
work
age of retirement
annuities
JEL:D11
D91
E21
G23
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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