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American Economic Review Vol. 99 No. 2 2009

Life Expectancy and Old Age Savings

Mariacristina De Nardi1; Eric French2; John Bailey Jones3

1 Research Department, Federal Reserve Bank of Chicago, 230 South La Salle Street, Chicago, IL 60604, and NBER. · 2 Research Department, Federal Reserve Bank of Chicago, 230 South La Salle Street, Chicago, IL 60604. · 3 Department of Economics, University at Albany, SUNY, BA-110, Albany, NY 12222.

Abstract

Rich people, women, and healthy people live much longer than their poor, male, and sick counterparts. Two extremes, taken from our analysis of single people in the Assets and Health Dynamics of the Oldest Old (AHEAD) dataset, illustrate this point: an unhealthy 70-year-old male at the twentieth percentile of the permanent income distribution expects to live only 6 more years, that is, to age 76. In contrast, a healthy 70-year-old woman at the eightieth percentile of the permanent income distribution expects to live 16 more years, thus making it to age 86.] Such significant differences in life expectancy could, all else equal, lead to significant differ ences in saving behavior. A related observation is that people with high permanent incomes keep large amounts of assets until very late in life. Table 1, also based on the

DOI
10.1257/aer.99.2.110
Volume
99
Issue
2
Pages
110-115
Language
en
Sources
bibtex:phds-export.bib crossref openalex

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