Pension Incentives and Early Retirement

Barbara Engels, Johannes Geyer and Peter Haan

No 1617, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: In this paper we exploit a cohort-specific pension reform to estimate the causal labour market effects of changes in the financial incentives to retire. In particular, we analyze the effects of the introduction of cohort-specific deductions for early retirement on female retirement, employment and unemployment. For the empirical analysis we use high-quality administrative data from the German pension insurance. We present evidence for sizable labour market effects. In addition to direct effects on women older than 60 we find important anticipation effects before reaching the pension eligibility age. Overall we document that the pension reform leads to a postponement of retirement, an increase in employment and a shifting in unemployment over age rather than a substitution into unemployment.

Keywords: Retirement age; pension reform; labour supply; actuarial deductions; cohort-specific pension reform; labour market effects (search for similar items in EconPapers)
JEL-codes: H21 J14 J18 J22 J26 (search for similar items in EconPapers)
Pages: 39 p.
Date: 2016
New Economics Papers: this item is included in nep-age, nep-dem, nep-eur and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Related works:
Journal Article: Pension incentives and early retirement (2017)
Working Paper: Changing incentives for early retirement - Causal evidence from a cohort based pension reform (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:diw:diwwpp:dp1617

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