Commentary Magazine

Aging and Old Age by Richard Posner

Elder Economics

Aging and Old Age
by Richard Posner
University of Chicago Press. 315 pp. $29.95

Richard Posner, chief judge of the United States Court of Appeals for the Seventh Circuit, has, through the prodigious application of intellect and energy, earned a reputation as one of the finest appellate judges in the country. In addition to his considerable judicial achievements, Posner remains an active presence at the University of Chicago Law School, where he taught from 1969 until President Reagan appointed him to the federal bench in 1981. Along with numerous articles, he has continued to produce a book—and sometimes two—virtually every year for the last decade, traversing fields as diverse as literary theory, philosophy, and biography.

As a scholar, Posner is most closely identified with “law and economics,” the intellectual movement he helped to found. At the risk of oversimplification, one may say that this approach entails asking of every legal rule three questions: what will it cost?; who will pay those costs?; and what will be the net result for social efficiency?

The analytical framework of law and economics is also present in Posner’s new book, Aging and Old Age, where it is supplemented by insights drawn from such varied disciplines as cognitive psychology, philosophy, and evolutionary biology. The result is what Posner terms an “economic psychology” which builds on the basic “human-capital” model of the life cycle customarily employed by economists to describe labor-market behavior, but which, thanks to the addition of multidisciplinary insights, offers a more powerful behavioral model than conventional economic analysis.

As becomes clear from Aging and Old Age, Posner believes this “thicker” approach can be used to explain virtually everything about the elderly, from the cluster of traits that characterize them—among which he names parsimony, garrulousness, risk-averseness, law-abidingness, high voter-participation rates, and slow driving—to the trajectory of their careers and their savings and consumption patterns.

Having elaborated this model of geriatric behavior, Posner next trains his sights on the entire gamut of age-related policy issues, from mandatory retirement and the best allocation of medical research-and-treatment dollars to euthanasia and the merits of physician-assisted suicide. In each case, he examines current institutions and practices and asks whether they meet his criteria of social efficiency.



In perhaps the most persuasively argued portion of this sprawling book, Posner applies traditional economic analysis to legal regimes directly affecting older citizens, including the Employees Retirement Income Security Act (ERISA) of 1974 and the Age Discrimination in Employment Act (ADEA) of 1967. In the case of the latter, Posner demonstrates how a law intended to protect older workers from discrimination in hiring, being unfairly fired, or being otherwise mistreated on account of age has had a whole series of unintended and perverse consequences.

For one thing, Posner argues, given the nature of the current labor pool, the ADEA tends to protect older white male workers, thus benefiting a group in little need of protection at the expense of more hard-pressed groups: minority and female entrants into the workforce. For another, the ADEA actually discourages employers from hiring older workers because the threat of an ADEA-inspired lawsuit makes it too difficult—and potentially expensive—to discharge an older worker who turns out to underperform on the job. Worse still, Posner cites statistical evidence to show that the ADEA is ineffective against age-related hiring discrimination because litigants in “failure-to-hire” cases are almost never able to establish substantial damages. In sum, the ADEA seems to protect those who least require its assistance, and not even to do a particularly good job of that.

Aging and Old Age also contains other thought-provoking discussions of old age and its surrounding issues. But alongside the serious and significant are any number of truly peculiar claims.



For example, Posner asserts that society would be better off if medical resources were diverted from treating diseases suffered by elderly women and were devoted to combating those suffered by elderly men. His reasoning is that if the latter lived longer, fewer of the former would be widowed and left without male companionship. And the cost for this reallocation of resources would be modest—only a year or two off the least happy portion of elderly women’s lives.

This summary, however, does not do full justice to the flavor of Posner’s arguments, which only extended quotation can adequately convey. Consider his explanation for why the elderly tend to be bad listeners. It seems they

invest less in the creation of human capital and therefore have less to gain from receiving inputs of information from other people. And because they transact less, they have less incentive to conceal egocentrism and to engage in cooperative rather than self-aggrandizing conversation and also less to gain from concealing traits that would reduce opportunities for advantageous transactions.

Couple the sheer strangeness of such assertions with their translation into mathematical terms and the book becomes odder still. Thus, along the way to arguing that the legalization of physician-assisted suicide would not encourage more elderly people to take their own lives, Posner explains that a terminally ill patient contemplating such an act is largely engaged in calculating the value of a particular variable, “c”:

[H]e must choose between two courses of action: one in which he commits suicide now, at a cost (in dread of death, pain, moral compunctions, whatever) of c; the other in which he postpones the decision to a time when, if he still wants to commit suicide, he will be unable to do so. The question is which course will confer greater utility on him. If he commits suicide now, he will have utility of -c. He will experience neither positive nor expected utility from living, because he will be dead, but he will incur the cost of getting from the state of being alive to the state of being dead.

I think most readers of Posner’s book will intuitively agree that there is something strange about such reasoning and the elaborate formulas that frequently accompany it1 By formalizing his assertions about human behavior as mathematical equations, Posner gives his claims the aura of objective physical laws. But a moment’s thought shows this is hardly the case. The equations simply repeat the assumptions of the text and are essentially unfalsifiable. How, for example, does one go about assigning an actual value to “the cost of getting from the state of being alive to the state of being dead”?

This leads to the nagging suspicion that Posner’s analysis is based on a logical error of a rather fundamental sort. The law-and-economics approach explicitly appropriates the insights of utilitarianism: people, as rational actors, seek to maximize happiness or “utility.” Early exponents of law and economics shared the assumption of mainstream economists that utility itself is unmeasurable, but that wealth is a proxy for it. Now, in Aging and Old Age, Posner claims that the same economic laws that apply to the measurement of financial well-being apply as well to utility in the original sense of happiness; having found that money can stand in for happiness, he would turn around and have this once-unmeasurable happiness stand in for money. He thus pushes the verifiable and quantifiable assumptions of economics into the un-quantifiable realm of nonmarket behavior—that is, ethically driven choices about well-being, satisfaction, and happiness in matters of family, health, life, and death.



To Posner’s credit, toward the close of this book he acknowledges that the subject of old age may have proved too vast even for the techniques of law and economics. True enough. Aging and Old Age may succeed in deepening our understanding of some aspects of aging, particularly the legal structures that affect our rapidly graying population. But in exploring such troubling problems as euthanasia and suicide, its perversely unsentimental and dehumanized approach smacks of one of the more sinister trends of this century: the tendency to think of human beings as so many widgets and cogs.


1 For Posner, the final hedonic calculation of whether to commit suicide is embodied in the following formula of some complexity: pc(l-p)Uh+c, where p and (1-p) stand for the probability that the individual will find himself in the incurably ill or healthy state and Uh (1-p) is the sum of these utilities.

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