Intertemporal Substitution in Labor Force Participation: Evidence from Policy Discontinuities

Dayanand Manoli and Andrea Weber

No 2010-11, NRN working papers from The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria

Abstract: This paper presents new empirical evidence on intertemporal labor supply elasticities. We use administrative data on the census of private sector employees in Austria and variation from mandated discontinuous changes in retirement benefits from the Austrian pension system. We first present graphical evidence documenting delays in retirement in response to the policy discontinuities. Next, based on the empirical evidence, we develop a model of career length decisions. Using an estimator that exploits the graphical evidence, we estimate an intertemporal labor supply elasticity of 0:30; this relatively low estimate reflects that the disutility of labor supply rises relatively quickly with additional years of work.

Keywords: mortality; gender differential; causes of death; life expectancy; Austria (search for similar items in EconPapers)
JEL-codes: I12 I18 J16 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2010-10
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Citations: View citations in EconPapers (12)

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Working Paper: Intertemporal Substitution in Labor Force Participation: Evidence from Policy Discontinuities (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:jku:nrnwps:2010_11

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