The impact of population ageing on consumption in Spain: Revisiting the retirement – consumption puzzle

Antonio Cutanda; Juan A. Sanchis; Antonio Cutanda; Juan A. Sanchis

doi:10.3934/NAR.2026010

National Accounting Review

2026, Volume 8, Issue 2: 206-232. doi: 10.3934/NAR.2026010

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Research article

The impact of population ageing on consumption in Spain: Revisiting the retirement – consumption puzzle

Antonio Cutanda ^{1
,
,},
Juan A. Sanchis ²

1.
Facultad de Economía, Departamento de Análisis Económico, Universidad de Valencia, Valencia, Spain
2.
Faculty of Economics, Universitat de València and ERICES, Valencia, Spain

Received: 30 October 2025 Revised: 06 March 2026 Accepted: 24 March 2026 Published: 24 April 2026
JEL Codes: C23, C26, D12, D15, E21, J26

As the proportion of the Spanish population entering retirement continues to grow, the sustainability of the pay-as-you-go social security system is facing increasing pressure. This study examined the implications of this demographic shift on consumption patterns in Spain from 2002 to 2017, focusing specifically on the retirement consumption puzzle using data from the Survey of Households Finances (SHF). Our findings, obtained from various estimation methods, suggest that the average decline in non-durable consumption at retirement is approximately 20%. This is in line with results from other developed economies and exceeds previous estimates for Spain. However, our analysis provided inconclusive results regarding spending on food and beverages. Finally, we observed no significant differences in the responses of working individuals and retirees to changes in interest rates, suggesting that stabilisation policies do not necessarily have to be adjusted due to population ageing.
- consumer spending,
- panel data,
- regression discontinuity,
- instrumental variables,
- intertemporal substitution for consumption
Citation: Antonio Cutanda, Juan A. Sanchis. The impact of population ageing on consumption in Spain: Revisiting the retirement – consumption puzzle[J]. National Accounting Review, 2026, 8(2): 206-232. doi: 10.3934/NAR.2026010

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Abstract

As the proportion of the Spanish population entering retirement continues to grow, the sustainability of the pay-as-you-go social security system is facing increasing pressure. This study examined the implications of this demographic shift on consumption patterns in Spain from 2002 to 2017, focusing specifically on the retirement consumption puzzle using data from the Survey of Households Finances (SHF). Our findings, obtained from various estimation methods, suggest that the average decline in non-durable consumption at retirement is approximately 20%. This is in line with results from other developed economies and exceeds previous estimates for Spain. However, our analysis provided inconclusive results regarding spending on food and beverages. Finally, we observed no significant differences in the responses of working individuals and retirees to changes in interest rates, suggesting that stabilisation policies do not necessarily have to be adjusted due to population ageing.

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