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Increasing Life Expectancy, Retirement Age, and Pension Reform in the German Context

In many industrialized countries, a rising percentage of the elderly in the population is often seen as an important challenge to the economy and to society because of the aging of ‘‘baby boomers’’; smaller, younger cohorts, due to reduced fertility rates; and increasing life expectancy, especially of the elderly. In public debate, aging mainly is seen as a problem: discussion focuses on costs rather than benefits. The impact of aging populations on social securitypension schemes, health care, and long-term care insuranceis a major topic of political and scientific discussion in many countries. ‘‘Can we afford to grow older?’’ is an often-used phrase (Aaron, Bosworth, & Burtless, 1989; Bovenberg & van der Linden, 1997; Disney, 1996). Political proposals and decisions in many countries are aiming at a reduction of future expenditure development, especially in regard to public pension schemes.