Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/207350 
Year of Publication: 
2019
Series/Report no.: 
IZA Discussion Papers No. 12524
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
Higher life expectancy and rapidly aging populations have led to the introduction of pension programs in developing countries in the last two decades. Using the introduction of a new public policy in China, we estimate the effects of pension benefits on individual cognition, measured by episodic memory and intact mental status, among individuals ages 60 and above. We find large and significant negative effects of the provision of pension benefits on cognitive functioning among the elderly. We find the largest effect of the program on delayed recall, a measure implicated in neurobiological research as an important predictor of the onset of dementia. We show that the program leads to more 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.
Subjects: 
life-cycle
cognitive functioning
cognition
aging
health
mental retirement
middle-income countries
developing countries
China
JEL: 
J14
H55
H75
J26
J24
D91
O12
N35
O10
Document Type: 
Working Paper

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