Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/82265
Authors: 
Doblhammer, Gabriele
van den Berg, Gerard J.
Fritze, Thomas
Year of Publication: 
2011
Series/Report no.: 
Working Paper, IFAU - Institute for Labour Market Policy Evaluation 2011:14
Abstract: 
With ageing populations and a stronger reliance on individual financial decision-making concerning asset portfolios, retirement schemes, pensions and insurances, it becomes increasingly important to understand the determinants of cognitive ability among the elderly. To study effects of the early-life economic environment, macro-economic fluctuations may be used. In European countries, about three to four economic recession and boom periods occurred between 1900 and 1945. The timing of these periods differs across countries. We apply data from the Survey of Health, Aging and Retirement in Europe (SHARE) among elderly individuals. This survey is homogeneous across countries. We use almost 20,000 respondents from 11 countries. We examine several domains of cognitive functioning at ages 60+ and link them to the macro-economic deviations in the year of birth, controlling for demographic, socioeconomic and health status. We find that economic conditions at birth significantly influence cognitive functioning late in life in various domains. The effects are particularly pronounced among the less educated. Recessions negatively influence numeracy and verbal fluency as well as the score on the omnibus cognitive indicator. The results are robust; controlling for current characteristics does not change effect sizes and significance. We discuss possible causal pathways.
Subjects: 
cognition
economic business cycle
developmental origins
health
long-run effects
dementia
numeracy
memory
decision-making
JEL: 
I12
I18
J14
N14
N34
J26
Document Type: 
Working Paper

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