Economic Aspects of Ageing

Sammanfattning: This thesis concerns economic aspects of ageing and investigates incentives and outcomes related to this process. The thesis is a collection of five essays. An introductory chapter provides an overall economic perspective of ageing. Essay 1 (ch 2) examines mortality risks via duration analysis of widowed individuals in Scania, Sweden during the 19th century. The findings are qualitatively in line with previous results of studies based on modern data: Widowers in general face higher relative mortality risks than widows and the effect of spousal bereavement on mortality is decreasing through time. The estimated relative risks for widowers are dependent on socio-economic status; being landless implies high relative risks. Quantitatively, the magnitudes of our estimates are large in comparison with studies based on more recent data. Essay 2 (ch 3) investigates gender-dependent division of labour within the household. In economics this division is commonly attributed to gender differences in relative productivity. We assume completely gender-neutral production capacities, and introduce instead gender-dependent mortality risks as a factor affecting the allocation of resources within a household. In an ordinary marriage the wife faces lower mortality risk than the husband, indicating that the probability of entering into widowhood and the expected length of a potential widowhood period are greater for her. In our model this implies that the wife, via behaviour during marriage, will prepare for widowhood to a larger extent than the husband. Essay 3 (ch 4) tentatively, in the light of economic theory, analyses factors influencing the presence of a social network. Specifically, the structure of social support networks of 500 older men, aged 68 (born 1914 in Malmoe, Sweden), is studied in terms of their children and close friends. We find some support for the hypothesis that the "number of close friends", reported by the studied individuals, is negatively connected with the number of own children. This could be a result of the presence of own children diminishing the incentives for parents to create and maintain social relations with others. Essay 4 (ch 5) explores how diffusion of medical technology to older and older patient groups may have contributed to increasing health care expenditures in the industrialised world. Two specific cases are studied, both representing costly procedures: coronary bypass surgery and dialysis. In both cases, we observe significant diffusion to older age groups. Essay 5 (ch 6), proceeding from the results of the previous chapter, presents a simple theoretical framework, founded in ordinary welfare maximisation, of the diffusion of medical technology across age groups as a consequence of exogenously given technology development. The empirical part reveals major improvements for the CABG-technique regarding the mortality risk of newly treated patients and rehabilitation processes. According to welfare analysis this implies that afflicted individuals, in weaker and weaker general condition (e.g. older and older) and with lighter and lighter disability from the considered complaint, will be treated. Taking the estimates of technological improvements into account, the actual diffusion of the CABG-technique across age groups is consistent with the theoretical framework.