EconPapers    
Economics at your fingertips  
 

Retirement Plan Type and Employee Mobility: The Role of Selection and Incentive Effects

Gopi Goda, Damon Jones and Colleen Flaherty Manchester

No 18902, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Employer-provided pension plans may affect employee mobility both through an "incentive effect," where the bundle of benefit characteristics such as vesting rules, pension wealth accrual, risk, and liquidity affect turnover directly, and a "selection effect," where employees with different underlying mobility tendencies select across plans or across firms with different types of plans. In this paper, we quantify the role of selection by exploiting a natural experiment at a single employer in which an employee's probability of transitioning from a defined benefit (DB) to a defined contribution (DC) pension plan was exogenously affected by default rules. Using regression discontinuity as well as differences-in-regression-discontinuities (DRD) methods, we find evidence that employees with higher mobility tendencies self-select into the DC plan. Our results suggest that selection likely contributes to the observed positive relationship between the transition from DB to DC plans and employee mobility in settings where employees sort into plans or employers. Counter to conventional wisdom, we find a negative direct effect of the DC plan on turnover relative to the DB plan, which underscores the multi-dimensional difference between these plans.

JEL-codes: H0 J26 J32 (search for similar items in EconPapers)
Date: 2013-03
New Economics Papers: this item is included in nep-age, nep-dem, nep-hrm, nep-lab and nep-lma
Note: AG LS PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Published as Gopi Shah Goda & Damon Jones & Colleen Flaherty Manchester, 2017. "Retirement Plan Type and Employee Mobility," Journal of Human Resources, vol 52(3), pages 654-679.

Downloads: (external link)
http://www.nber.org/papers/w18902.pdf (application/pdf)

Related works:
Working Paper: Retirement Plan Type and Employee Mobility: The Role of Selection and Incentive Effects (2013) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:18902

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w18902

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2025-03-19
Handle: RePEc:nbr:nberwo:18902