The Welfare Effects of Protecting Older Workers

Todd Morris, Stefan Staubli and Benoit Dostie

No 35111, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We evaluate the welfare effects of five provincial mandatory retirement bans in Canada from 2005 to 2009 using linked employer-employee tax data. The bans sharply reduce retirements at age 65, with sizable announcement effects and heterogeneity across industries. Post-65 employment and earnings rise at least 14%, with gains comparable to a two-year increase in pension-eligibility ages. Older workers save more and spouses postpone retirement, benefiting public finances, with no observable effects on mortality or younger workers. Highly exposed firms reduce payroll costs via hiring adjustments while maintaining worker productivity and profitability. Our results suggest that protecting older workers was welfare-improving.

JEL-codes: H55 J26 J78 (search for similar items in EconPapers)
Date: 2026-04
New Economics Papers: this item is included in nep-hea and nep-lma
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