The association between individual income and remaining life expectancy at the age of 65 in the Netherlands

This paper quantifies the association between individual income and remaining life expectancy at the statutory retirement age in the Netherlands of 65. For this purpose, we estimate a mortality risk model using a large administrative dataset that covers the 1996–2007 period. Besides age and marital status, the model includes as covariates individual and spouse’s income, as well as a random individual specific effect. It thus allows for dynamic selection based on both observed and unobserved characteristics.We find that, conditional on marital status, individual income is about equally strong and negatively associated with mortality risk for men and women and that spouse’s income is only weakly associated with mortality risk for women. For both men and women, we quantify that remaining life expectancy at age 65 for low-income individuals is about two-and-a-half years less than that for high-income individuals.

Netspar, Network for Studies on Pensions, Aging and Retirement, is a thinktank and knowledge network. Netspar is dedicated to promoting a wider understanding of the economic and social implications of pensions, aging and retirement in the Netherlands and Europe.

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