Most Gains in Life Expectancy are Now Realized Late in Life
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Much of the gain in life expectancy at birth over the past two centuries was realized through reductions in early mortality. This was achieved through sanitation, increased wealth, and control of infectious disease. As this paper notes, that trend is largely done with now, and the gains in life expectancy overwhelmingly arrive in later life due to advances in medical technologies aimed at treating the diseases of aging. The authors, economists rather than biogerontologists, see this as a potential problem because of increased length of retirement. In reality retirement is just a tradition, however, already unjust where it is enforced by law, and removed from the reality that individuals who remain healthy for longer thanks to modern medicine can just carry on being productive and working for a living. Do people serve laws or do laws serve people?

As life spans lengthen, retirement as an institution will change, as the reason for its existence - the ill health and incapacity that accompanies aging - will ultimately vanish. Similarly the culture of government-enforced entitlement in which resources are transferred from comparatively poor and disempowered young people to comparatively wealthy and empowered old people must also be dismantled in the years ahead: it is unsustainable and morally bankrupt besides. All of the financial problems that the political chattering classes fret about with respect to increasing longevity are created by the present system of governance and its entitlements and rules, which together threaten to make a grand and damaging economic ruin out of what would otherwise be a great benefit.

The original "demographic transition" describes a process that began in Europe by the early 1800s with decreases in mortality followed, usually after a lag, by decreases in fertility. This historical process ranks as one of the most important changes affecting human society in the past half millennium. The increase in life expectancy associated with this demographic transition has been accompanied by rising levels of per capita output, which have in turn spurred further improvements in population health.

Now, the United States and many other countries are experiencing a new kind of demographic transition. Instead of additional years of life being realized early in the lifecycle, they are now being realized late in life. At the beginning of the twentieth century, in the United States and other countries at comparable stages of development, most of the additional years of life were realized in youth and working ages; and less than 20 percent was realized after age 65. Now, more than 75 percent of the gains in life expectancy are realized after 65 - and that share is approaching 100 percent asymptotically. The choice of age 65 to illustrate this new demographic transition is somewhat arbitrary, but if we used 60 or 70 instead, the results would be qualitatively similar.

The new demographic transition is a longevity transition: how will individuals and societies respond to mortality decline when almost all of the decline will occur late in life? This issue is broader and more far-reaching than the issue of cohort size in each age group, with its focus on the prospective retirement of the unusually large "baby boomer" cohort, and has important socio-economic implications independent of patterns of fertility.

When the gains in life expectancy occur mainly towards the end of life, they contribute more to the age bracket that is traditionally mostly retired rather than to the age bracket in prime working years. Retirees are highly dependent on transfers from the working population for living expenses, including large consumption of medical care. Thus, gains in life expectancy concentrated at the end of life can unsettle an economy's balance between production and consumption in ways that pose a long-run challenge for public policy. The obvious changes that are needed (at least "obvious" to many economists") would be to raise productivity, to raise the savings rate, and to raise the age of retirement, but how to accomplish such goals is controversial and uncertain.

Link: http://www.ncbi.nlm.nih.gov/pmc/articles/PMC4112481/

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