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Permanent Wage Cost Subsidies for Older Workers. An Effective Tool for Increasing Working Time and Postponing Early Retirement?

Andrea Albanese () and Bart Cockx ()

No 5301, CESifo Working Paper Series from CESifo Group Munich

Abstract: In several OECD countries age-targeted wage subsidies have been introduced to increase the employment of older workers, but evidence on their effectiveness is scarce. This paper examines the effects of a permanent wage cost subsidy in Belgium on the employment rate, working time and hourly wage. We estimate these effects by integrating Inverse Probability Weighting in a, possibly trend-adjusted, Difference-in-Differences of endogenously sampled repeated cross sections. We find small positive short-run impacts on working time and larger ones on the employment rate, but only for employees at high risk of leaving to 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 J30 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (13) Track citations by RSS feed

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Related works:
Working Paper: Permanent Wage Cost Subsidies for Older Workers. An Effective Tool for Increasing Working Time and Postponing Early Retirement? (2015) Downloads
Working Paper: Permanent Wage Cost Subsidies for Older Workers: An Effective Tool for Increasing Working Time and Postponing Early Retirement? (2015) Downloads
Working Paper: PERMANENT WAGE COST SUBSIDIES FOR OLDER WORKERS. AN EFFECTIVE TOOL FOR INCREASING WORKING TIME AND POSTPONING EARLY RETIREMENT? (2015) Downloads
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