The proposed research seeks to investigate the determinants of borrowing and repayment patterns from 401(k) pension plans. In this pilot project, we seek to assess how employee and plan characteristics affect the propensity to take these loans, the likelihood of repaying them, and how large the loans are when people take them. The economic life-cycle model predicts that younger people will be more likely to take loans as they are more credit-constrained.

With individuals living longer and the aging of the Baby Boomer cohort, the US is experiencing a demographic revolution. Given that risk of dementia increases substantially with age, this aging revolution will drastically increase the prevalence of dementia unless interventions to prevent or delay it are found. Physical activity has been identified as a potential intervention to lower the risk of dementia and/or improve/maintain cognitive function.

The introduction of lifecycle funds into 401(k) plans offers a rich environment in which to assess workers’ portfolio allocation decisions. Consistent with behavioral models, employer design decisions strongly influence lifecycle adoption behavior while fundamentally altering portfolio characteristics, both in the cross-section and longitudinally. Yet there are also elements of rational choice by new employees, as well as choice constrained by information costs among workers with low literacy characteristics.

We examine insurance markets in which there are two types of customers: those who regret suboptimal decisions and those who don’t. In this setting, we characterize the equilibria under hidden information about the type of customers and hidden action. We show that both pooling and separating equilibria can exist.

How do the economic bene…ts of marriage vary with macroeconomic conditions? One of the major bene…ts of marriage is the ability to dynamically coordinate labor supply decisions in response to shocks. For instance, when one spouse loses a job, the other can work more. This paper argues that dynamic coordination is countercyclical; the innovations to husbands’ and wives’labor incomes are more positively correlated when the economy is growing rapidly.

In the U.S. and in Chile, there have been heated debates about the relative merits of a decentralized privatized pension system relative to a more traditional social security system. One criticism of a privatized system is that consumers are not sufficiently financially literate to make saavy decisions when it comes to selecting among funds in a way that takes into account commissions/fees and fund performance. Another concern is that consumers may not understand risk-return relationships and may therefore tend to take on too much risk.

The main goal of this project is to evaluate the effect of Chile’s pension system rules and regulations on individuals’ contribution patterns. The few empirical studies on the Chilean Pension System have been limited to the use of aggregate and macro data. This project’s contribution is to analyze pension contribution patterns under the Chilean AFP system using micro data and state-of-the-art modeling methods.

Medicare, the main health insurer for the elderly, has recently experienced the biggest reform since its inception: the inclusion of prescription drug coverage for its beneficiaries. Most discussion of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 has focused on the cost of implementing this new policy, leaving unexplored the quantification of its benefits. In fact, very little is known about the effect this policy will have on health outcomes, life expectancy and the substitution from more expensive modes of medical care, such as inpatient care.

Education not only impacts expected future earnings, it may also impact income risk. This pilot will examine the impact of education on income volatility. When using standard cross-sectional data sets to estimate the impact of education on earnings, it is difficult to differentiate risk from heterogeneity. This paper overcomes this problem by exploiting the panel feature of the Panel Study of Income Dynamics (PSID) to estimate income volatility directly for many individuals.

This investigation will seek explanations of the recent poor performance of mortality among older women in the United States, relative both to older men and to women in previous eras. It will investigate causes of death responsible for the slowdown in their rate of mortality advance, and will study the role of changes in risk factor distributions. Particular attention will be paid to the role of cigarette smoking histories and to obesity. An effort will be made to combine information on changes in risk factor distributions with estimates of their mortality consequences.