Optimal Aging with Uncertain Death

Arbeitspapier

This note extends the theory of optimal aging and death (Dalgaard and Strulik, 2010) towards uncertain death. Specifically, it is assumed that at any age the probability to survive depends on the number of health deficits accumulated. It is shown that the results in Dalgaard and Strulik (2011) on the foundation of the Preston curve (the association between income and life-expectancy across countries) are robust against this extension. While results virtually coincide at high income levels, the stochastic version predicts somewhat more curvature of the Preston curve at low income levels. Taking uncertain death and a precautionary motive for health investment into account thus further improves a bit the anyway good fit of the Preston curve.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Diskussionsbeitrag ; No. 488

Classification and Topics

• Classification: Wirtschaft ; Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡ ; Value of Life; Forgone Income ; Retirement; Retirement Policies ; Health Behavior
• Subject: Aging ; Longevity ; Health ; Savings ; Preston Curve

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Strulik, Holger
• Event: Veröffentlichung
• (who): Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät
• (where): Hannover
• (when): 2011

Further information

• Handle: http://hdl.handle.net/10419/73101
• Last update: 10.03.2025, 11:43 AM CET