A1208
Title: Time to see a doctor: Expenditure at retirement in Japan
Authors: Kento Tango - Yokohama City University (Japan) [presenting]
Yoshiyuki Nakazono - Yokohama City University (Japan)
Abstract: Using household panel data, it is tested whether there exists a decline in consumption at retirement. We find stark evidence of retirement consumption; there is an immediate decline in expenditure of 2.4\% even at expected retirement. The negative effect of retirement on expenditure is persistent, and it lasts for at least two years. However, there is no dip in the consumption of higher-educated households, as is the case with lower-educated households. Further, the decline in the consumption of healthcare products such as drugs is severe. Indeed, lower-educated households decrease expenditure on drugs by 25\% at most. An additional survey for healthcare use reveals that frequent visits to the doctor explain the decline in expenditure on over-the-counter (OTC) drugs. The results suggest that the reduced opportunity cost of time to see a doctor induces households at retirement to visit a doctor more often than before, and obtain prescribed drugs at more affordable prices than OTC drugs, possibly owing to the universal health insurance system.
