Working Longer, Working Stronger? The Forward-Looking Effects of Increasing the Retirement Age on (Un)employment Behaviour

Niklas Gohl (niklas.gohl@uni-potsdam.de)
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Niklas Gohl: University of Potsdam, Berlin School of Economics, DIW

No 63, CEPA Discussion Papers from Center for Economic Policy Analysis

Abstract: Leveraging two cohort-specific pension reforms, this paper estimates the forward-looking effects of an exogenous increase in the working horizon on (un)employment behaviour for individuals with a long remaining statutory working life. Using difference-in-differences and regression discontinuity approaches based on administrative and survey data, I show that a longer legal working horizon increases individuals’ subjective expectations about the length of their work life, raises the probability of employment, decreases the probability of unemployment, and increases the intensity of job search among the unemployed. Heterogeneity analyses show that the demonstrated employment effects are strongest for women and in occupations with comparatively low physical intensity, i.e., occupations that can be performed at older ages.

Keywords: retirement policies; employment; DiD (search for similar items in EconPapers)
JEL-codes: H21 J24 J26 (search for similar items in EconPapers)
Date: 2023-03
New Economics Papers: this item is included in nep-age, nep-des, nep-eur, nep-lma, nep-mac and nep-pbe
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Persistent link: https://EconPapers.repec.org/RePEc:pot:cepadp:63

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