Higher life expectancy and rapidly aging populations in developing countries, especially in the last three decades, have created the need for policymakers to introduce pension programs in developing countries. China launched the New Rural Pension Scheme (NRPS) in 2009 to ease internal demographic pressures and concerns about old-age poverty . Using data from the introduction of the NRPS in China, we estimate the effects of pension benefits, due to participation in the NRPS, on individual cognition, measured by episodic memory and intact mental status, among individuals aged 60 and above . We find large negative effects of the provision of pension benefits on cognitive functioning among the elderly. We detect the most substantial impact of the program to be on delayed recall, a measure implicated in neurobiological research as a significant predictor of the onset of dementia. We show suggestive evidence that the program leads to stronger negative impacts among the female sample. Our findings support the mental retirement hypothesis, that decreased mental activity results in atrophy of cognitive skills . We show that retirement plays a significant role in explaining cognitive decline at older ages.
Historically, economists have mainly focused on human capital accumulation and considerably less so on the causes and consequences of human capital depreciation in late adulthood. Studying human capital depreciation over the life cycle has powerful economic consequences for decision-making in old age . Using data from the introduction of a retirement program in China, we examine how the introduction of a retirement program influences individual cognition . We find large negative effects of pension benefits on cognitive functioning among the elderly. We detect the most substantial impact of the program to be on delayed recall, which is a significant predictor of the onset of dementia. We show suggestive evidence that the program leads to larger negative impacts among women . We show that retirement plays a significant role in explaining cognitive decline at older ages.
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Higher life expectancy and rapidly aging populations in developing countries, especially in the last three decades, have created the need for policymakers to introduce pension programs in developing countries. China launched the New Rural Pension Scheme (NRPS) in 2009 to ease internal demographic pressures and concerns about old-age poverty
Historically, economists have mainly focused on human capital accumulation and considerably less so on the causes and consequences of human capital depreciation in late adulthood. Studying human capital depreciation over the life cycle has powerful economic consequences for decision-making in old age
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the NRPS
a retirement program
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estimate the effects of pension benefits, due to participation in the NRPS, on individual cognition, measured by episodic memory and intact mental status, among individuals aged 60 and above
examine how the introduction of a retirement program influences individual cognition
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the provision of
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a measure implicated in neurobiological research as a
which is a
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stronger
larger
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the female sample. Our findings support the mental retirement hypothesis, that decreased mental activity results in atrophy of cognitive skills
women