We provide a unified theory of the transition in income, life expectancy, education, and population size from a nondeveloped environment to sustained growth. Individuals optimally trade off the time cost of education with its lifetime returns. Initially, low longevity implies a prohibitive cost for human capital formation for most individuals. A positive feedback loop between human capital and increasing longevity, triggered by endogenous skill-biased technological progress, eventually provides sufficient returns for widespread education. The transition is not based on scale effects and induces population growth despite unchanged fertility. A simulation illustrates that the dynamics fit historical data patterns.
Employment protection legislation (EPL) is an important labour market policy whose strictness differs greatly across OECD countries. The collection of articles in this Feature provides new theoretical and empirical results which highlight the impact of EPL on productivity, job and firm turnover, (un)employment and the incidence of temporary contracts. Importantly, the effect of EPL is shown to differ across types of workers and firms. This yields new insights on the incentives for labour market reform.
Switzerland is one of the few countries with long-term experience in withdrawal decisions made by retirees in fully funded pension plans. Switzerland is also atypical in its unusually high annuitization rates, and indeed, a majority of retirees covered by mandatory occupational pension plans chooses an annuity at retirement. This chapter revisits the historical role of occupational pension plans in the provision of old-age income, and examines the role of regulation in the payout phase. Recent developments in both market conditions and regulations are used to assess the impact of certain determinants of the annuitization decision, such as money's worth ratios, means-tested benefits, and behavioral factors.
