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Permanent wage cost subsidies for older workers. An effective tool for employment retention and postponing early retirement?

Andrea Albanese () and Bart Cockx ()

Labour Economics, 2019, vol. 58, issue C, 145-166

Abstract: This paper examines the effects of a permanent wage cost subsidy in Belgium on employment retention, working time and hourly wage of older men. To estimate these effects we propose a semi-parametric weighted difference-in-differences estimator that accounts for endogenous stratification in the sampling from a population of men born between 1941 and 1950. We find small positive short-run impacts on working time and larger ones on the retention rate in employment, but only for employees at high risk of early retirement. The wage is not affected.

Keywords: Wage cost subsidies; Older workers; Weighted difference-in-differences; Endogenous sampling (search for similar items in EconPapers)
JEL-codes: J14 C21 J18 J3 (search for similar items in EconPapers)
Date: 2019
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DOI: 10.1016/j.labeco.2018.01.005

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