Dissertation

Figure 3.13: Baseline cross-sectional age-consumption profiles under Hansen (1993).

50

1

45

40

35

30

25

20

15

10

0

5
2

3

4

5

Student Version of MATLAB

25 40 55 70 85 100

Age

Labor hours per week

Consumption
Figure 3.14: Baseline cross-sectional age-labor hour profiles under Hansen (1993).

1

0.9

0.8

0.7

0.6

0.5

0.4

Model U.S.

74

0.2 0.4 0.6 0.8 1 1.2 1.4 1.6 1.8

Multiple of average earnings

Figure 3.15: Gross replacement rates: Model Vs U.S. under Hansen (1993).

profiles are compared in Table 3.18, in which 1 corresponds to the lowest efficiency level

and 5 corresponds to the highest. The table shows that even with the efficiency profile from

Hansen (1993), less efficient households continue to exit the labor force before the more

efficient households.

Next, I report in Table 3.19 the results of re-simulating demographic experiments 1,

2 and 3 on the calibrated baseline model identified above. Examination of Table 3.19