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Older Workers in a Sustainable Society

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Edited By Richard Ennals and Robert H. Salomon

The challenges of an ageing population and workforce are increasingly recognised by policy makers, managers and workers in many countries. In this book, prominent researchers address these challenges. It deals with health and workability, and gives data and viewpoints on competitive advantages and disadvantages of older workers. The study includes data on attitudes, specific measures and policies from many parts of the world: Europe, Australia, New Zealand, Brazil and Singapore. The authors present a variety of interesting examples of measures used in workplaces, to motivate and enable workers to stay longer in working life. This book is an encounter between research and policy: it contributes to the discussion of policies related to older workers.

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Part 4: The Choice is yours – on Incentives and Individual Choices 203

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203 Part 4: The Choice is yours – on Incentives and Individual Choices 204 205 16 Economic and Social Incentives for Viable Age Policies Knut Røed The demographic challenge There has been a rapid change in the number of people in the workforce, com- pared with those who are of retirement age or above. This poses a challenge for policy makers. A viable age policy would be a policy that balances work, consumption and leisure over the lifetime for an ageing population. We should not assume that ageing is to be regarded as necessarily implying labour market inactivity. Do we all have to work more, or longer? In principle, we do have a choice. We can work longer, or consume less. There is, from an economics perspective, no basis for arguing that everyone should work longer. After all, leisure is not of lower economic value than a flat-screen TV. We should consider changes in health and wealth. Is it now easier and more profitable to work longer? Are leisure activities more attractive? These questions are not to be decided by policy makers. The economist’s recommendation We should work as long as, and to the extent that, the value of the work exceeds the value of the foregone leisure. This principle obviously calls for individually determined retirement profiles. As we age, the cost of providing the required effort may rise, and leisure may become more valuable. At some point, we probably also become less pro- ductive. The speed by which this...

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