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Public pensions, economic development, and the labor force participation of older adults in Latin America in 1990–2010

related to the reduction of the labor force participation rates of older males in Latin
American countries. The results observed here went in a similar direction as observed
elsewhere (Clark and Anker, 1990; 1993; Clark, Young, and Anker, 1999; Nava-
Bolaños and Ham-Chande, 2014).
Given that increases in GDP per capita usually mean economic growth, urbanization,
population aging and more matured public pension programs, thus when GDP per
capita increases, the labor force participation rates of older males, even those aged
55–59, start to decline. However, even if economic development and public pension
programs could explain the decline in labor force participation to a large extent, they
might not be the best explanatory factors for ages 50–54 and ages 55–59, because
health status of the older workers may explain these declines as well. However, due
to unavailability of data on whether those leaving the labor force were because they
retired from work, lose their jobs and decided not to look for another job, or because
their health conditions forced them to retreat from labor force, we were not able to
investigate root causes of decline in labor force participation. Our findings should
also be interpreted with caution because education level and income level are not
completely exogenous to the labor force participation of older adults. The regression
of labor force participation on income level (or education) likely introduced some
econometric problems. For example, estimated coefficients could be capturing
differences between countries, which may cause unobserved heterogeneity.
The rapid process of population aging will have huge impacts on the public old-
age support system for the older population in Latin America. The increase in old
age dependency ratio means that a larger number of potential beneficiaries will
depend on a smaller number of workers. The results also suggest, for Latin America,
that as economic grows and pension systems become universal and more generous,
the labor force participation at older ages tend to decline more rapidly (Bloom and
McKinnon, 2010). The importance of old-age support systems throughout the world
is unquestionable, and the well-being of the older population depends heavily on
the provision of income from such programs (Melguizo, Bosch, and Pages-Serra,
2017). However, the necessity to adjust such programs to population aging is clear
and fundamental. One of the main questions in this discussion is how the reform,
and in some cases the implementation of the programs, should take place, and which
generations will afford for the burden of the reform. Further research should focus on
country-specific studies, such as the coordinated study by Gruber and Wise (1999)
to better understand the relation to elderly labor force and retirement behavior in less
developed economies. The results aggregated to the regional level in Latin America
raises the importance of country-specific studies following research for Mexico (Aguila,
2014) and for Brazil (Queiroz, 2008).

Conflict of Interest and Funding

No conflict of interest has been reported by the authors. This manuscript is part of the
research project “Demographic transition, labor market, and concentration of highly
skilled workers in developing countries” funded by the Minas Gerais Research Support
Foundation (FAPEMIG) (CSA 01802-13 APQ), Brazil, and the Brazilian Ministry
of Science, Technology, and Innovation (CNPq/MCTI) (Bolsa de Produtividade em
Pesquisa and Projeto Ciências Sociais Aplicadas 474156/2013-3).
Acknowledgements

The author gratefully acknowledges helpful comments received from the referees and
the editor of the journal.

Ethics Approval

Not applicable as this study used secondary aggregated data from publicly available
sources.

134 International Journal of Population Studies 2017, Volume 3, Issue 1