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T. Spanninger:
"The effect of rising longevity on optimal education investment and retirement age";
Supervisor: A. Fürnkranz-Prskawetz; Institut für Stochastik und Wirtschaftsmathematik, 2018; final examination: 2018-03-13.

This thesis investigates the effect of rising longevity on the individual´s decision of optimal
education, called Ben-Porath effect and the consequences on the optimal retirement age.
Overlapping generations models with three periods: childhood, working age and old age,
are suitable for modeling the human life cycle, since the transition of life cycles can be
defined in line with individual decisions to optimize the lifetime utility. But also models
with continuous and discrete flows of consumption and utility are investigated in this
thesis. It will be shown that self fulfilling prophecies can occur in an economy that
follows the Ben-Porath effect. The uncertainty of lifetime has a considerable impact on
the dynamics of the Ben-Porath effect. Survival probabilities have strongly increased in
the middle and old age during the last decades and lead to an increase in life expectancy.
The Ben-Porath effect also depends on the change of age specific survival probabilities
significantly. It can be shown as well, that the conditional probability to die at age t,
given the survival until age t, called Hazard rate and conditions of living (like health
and family circumstances) influence the Ben-Porath effect. Additionally, as the level of
education affects the individual lifetime earnings and lifetime labor supply, it is generally
necessary to investigate the effects of rising longevity on the retirement age at the same
time.