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Thesis/Degree/Other Honours
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Summary:
The first chapter evaluates the effect of the 2001 MIG reform on British pensioners take-up behaviour.
Considering a set of pensioners interviewed in the Family Resources Survey (FRS) before the changes were introduced and another set of pensioners interviewed after the reform came into force, the benefit entitlements for each set under the old and the new system are simulated. Pensioners are subsequently matched according to a 'nearest neighbour' distance minimization criterion in terms of entitlements and other characteristics in order to identify their behavioural response to the reform. Different matching options are implemented. Such non-parametric approach is also compared to the more traditional parametric analysis. The take-up response to the reform is found significant and positive according to all of the implemented specifications. An ex-ante evaluation of the same reform points at an even higher response, once adjustment to new rules has taken place.
The purpose of the second chapter is to evaluate the impact of the Pension Credit introduction on pensioner’s take-up levels and in particular to investigate whether there is a role for complementary policies besides entitlement increase in promoting take-up. In October 2003 the Pension Credit introduction substantially changed the structure of the income support system for pensioners, increasing the benefit amount, modifying rules about capital income, removing the upper capital threshold on eligibility and introducing a saving component in the entitlement. Several complementary policies were also implemented with the aim of raising pensioners’ awareness about the existence of the scheme and their chance to be entitled and also to increase take-up rates. The means testing was made less intrusive as some income components (as contributions from families, friends and charities) were disregarded in the means calculation. While all pensioners were subject to such complementary policies, the way they were affected by the change in the benefit structure changed with the level of personal resources: poorest pensioners (not eligible for “saving credit”) did not experience any increase in real entitlement; another group, who became entitled also to the “saving credit” experienced a real increase in entitlement; finally, a group of relatively richest pensioners became newly entitled only to the “saving credit” after the Pension Credit came into force. Besides identifying the overall reform effect on take-up, the paper investigates whether there was a role for policy initiatives other than improving financial incentives in triggering claims. Results support the idea that raising the benefit level has been an effective way of fostering new claims. In contrast, no evidence of an increase in take-up due to the ‘lowering barriers’ policies per se has been found, even though these policies seem to have partially enhanced the effect of financial incentives when concurrently applied.
The third chapter is expected to analyse the receipt of non-means tested disability benefits by older people in a longitudinal framework, using BHPS data. The panel dimension of the data will allow to investigate whether transitions into need of care or the worsening of an underlying health status are effectively accompanied by subsequent disability benefit receipt.
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