Rejuvenating Economics: Subjective Age’s Influence on Work-Life Balance
By Andre Briviba, Valentin Schnellmann & Bruno S. Frey
Chronological age is a key indicator in economics, determining policy decisions such as the retirement age and the minimum voting age. The concept of subjective age, extensively studied by gerontologists and psychologists, may be particularly relevant to economic decision-making. Using panel data from German adults aged 40–65 and individual fixed-effects estimations, we investigate the effect of subjective age on work and life satisfaction. Furthermore, we estimate the impact of subjective age on the allocation of time between paid work and leisure activities. We find that a younger subjective age induces a shift in the trade-off towards leisure. These results support our conceptualization of subjective age as an expansion in the individual’s opportunity set. It demonstrates that subjective age provides explanatory power beyond chronological age, thereby enabling a more nuanced understanding of heterogeneity within age cohorts. It appears to be a suitable signal worth incorporating into labor and behavioral economic models.
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