Pension Incentives, Labor Supply and Heterogeneous Pension Systems

Dag S. Holen
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Dag S. Holen: Ragnar Frisch Centre for Economic Research

No 18/2008, Memorandum from Oslo University, Department of Economics

Abstract: People with an uncertain health condition might face a double worry. They fear to get disabled, and if they are disabled, that they will receive a low pension. To keep their health they should work less. To improve their disability pension they should work more. This paper demonstrates that the latter effect is the strongest empirically. Thus to protect one self against the income loss of a bad event, the bad event is more likely to happen. Comparing register data from disabled and non-disabled individuals shows that being disabled increases income in the last year before the time of disablement. Further, more generous pension systems increase pre-disablement income even more.

Keywords: Disability pension; pension; pension systems (search for similar items in EconPapers)
JEL-codes: A10 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2007-03-27
New Economics Papers: this item is included in nep-age and nep-lab
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:osloec:2008_018

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