Human Capital Formation, Life Expectancy and the Process of Economic Development
[INSTITUTE FOR THE STUDY OF LABOR (IZA) - By Matteo Cervellati and Uwe Sunde - Bonn, Germany - September 2002] This paper presents a microfounded theory of long-term development. We model the interplay between economic variables, namely the process of human capital formation and technological progress, and the biological constraint of finite lifetime expectancy. All these processes affect each other and are endogenously determined. The model is analytically solved and simulated for illustrative purposes. The resulting dynamics reproduce a long period of stagnant growth as well as an endogenous and rapid transition to a situation characterized by permanent growth. This transition can be interpreted as industrial revolution. Historical and empirical evidence is discussed and shown to be in line with the predictions of the model. (PDF)

Social Whirl May Help Keep the Mind Dancing
[ New York Times - 29 October 2002 - This story requires free New York Times registration.] People hoping to stay sharp as they age often turn to crossword puzzles, math problems and other demanding intellectual pursuits. But is all that really necessary? A new set of studies suggests that it may be just part of the solution. Simply talking to people, the researchers say, appears to keep mental skills sharp.

Designing Optimal Benefit Rules for Flexible Retirement
[KELLOGG SCHOOL OF MANAGEMENT, NORTHWESTERN UNIVERSITY - By Peter Eso and Andras Simonovits - September 2002] Abstract: This paper applies the techniques of mechanism design to find an optimal nonlinear pension benefit rule for flexible old-age retirement. We assume that individuals have private information regarding their expected lifespans. The government's goal is to design a pension system (a payroll tax and a function relating benefits to employment length), which maximizes a social welfare function and satisfies a social budget constraint. Since individuals with different expected lifespans optimize their employment lengths conditional on the benefit function, the government must also take into account incentive constraints. We characterize the solution to this problem for various social welfare functions. Under utilitarianism, the solution is a completely inflexible system, where all individuals retire at the same age with the same (yearly) benefits; and, surprisingly, the first-best (complete information) aggregate welfare is attained. If the social welfare function is strictly concave, then individuals with shorter expected lifespans retire earlier with benefits lower than those in the first-best. In the optimal pension system, individuals with shorter expected lifespans subsidize those who expect to live longer. We also compute the optimal benefit rule for several specifications with CRRA utility functions and realistic parameter values, and discuss the numerical results.

Demographic Evolutions and Unemployment: an Analysis of French Labour Market with Workers Generations
[CENTRE D'ETUDES PROSPECTIVES ET D'INFORMATION INTERNATIONALES - By Jean Chateau, Jean-Louis Gurin and Florence Legros - October 2002] Abstract: This paper describes a segmented matching labour market model with generations of workers. This model is calibrated on French data. The results refute the usual idea, according to which a decrease in labour supply leads to a decrease in unemployment. The combination of pure demographic effects with scalwedge effects due to the increase in subscription rates lead to a serious rise of the unemployment rate. Various alternative specifications are also studied such as an increase of work duration or a lowering in replacement rates.

Working in Britain survey - older workers, women
[Economic & Social Research Council - 24 October 2002] Older workers, and women, some of the most contented workers, are now much more critical of the conditions attached to their work and are particularly unhappy with their working hours, says the new 'Working in Britain' survey within the Future of Work Programme funded by the Economic and Social Research Council.

Commission issues 2002 Employment in Europe report
[EIRO - 23 October 2002] The Commission highlights 'active ageing' as a key challenge for the European labour market, as the employment rate for older workers increased between 1995 and 2000 by only 1.8 percentage points, compared with 3.3 percentage points for the whole working-age population. It notes that significant progress was made during 2001, when the employment rate for older workers increased by 0.8 percentage points over the year, but points out that this is not sufficient to enable the EU to reach the Stockholm target. The report cites a number of areas in which improvements could be made, including: reforms to the tax, benefit and pension systems in the EU; a fundamental change in the attitudes of society; recruitment and training practices; and 'quality of work' , including in particular work organisation and working conditions.

SeniorNet Leads by Showing Older Adults the Benefits of Computer Training and the Internet
[San Francisco, California � 22 October 2002] SeniorNet, the world's largest trainer of older adults on computer technology and the Internet, today announced the launch of a national public awareness campaign, a 12-month series of public service announcements, to help educate older adults and the general public about the benefits of computer training and the Internet for seniors.

'Flexible' retirement gains ground: Government admits millions may have to work on beyond 65
[The Guardian - 10 October 2002] Millions of people may have to work beyond the present retirement age of 65 under government plans for a shake-up of pensions policy.

Younger workers feel stuck as older ones don't retire
[AARP/USA Today - 11 October 2002] The bear market and weak economy are causing many older workers to stay put rather than retire and make way for younger employees. The logjam is raising generational tensions in the workplace, experts say. Labor force participation by workers ages 55-64 rose by 2 percentage points from 2001 -- an unprecedented jump in postwar economic history, according to a September study by the Center for Retirement Research at Boston College.

Bored to Death? Public Health researcher finds that boring, low-control jobs can increase risk of death
[University of Texas] In the most comprehensive study of its kind examining the working life of Americans, researchers at The University of Texas School of Public Health at Houston have released new evidence that boring, low-control jobs can hasten death.

See also:
Boring Jobs Can Kill You
[(Minneapolis) Star Tribune] This is the claim of researchers from the University of Texas School of Public Health, who found that workers who spent their lives in undemanding jobs with little control over their work were 35 percent more likely to die during a 10-year period than workers in challenging jobs with lots of decision-making responsibilities, after controlling for other relevant factors.