The sooner, the better? Analyzing preferences for early retirement in European countries

Didier Blanchet and Thierry Debrand

No DT13, Working Papers from IRDES institut for research and information in health economics

Abstract: Individual preferences concerning retirement age are strongly differentiated both within and between countries. According to the Share survey, the proportion of workers aged from 50 to 65 who wished to retire as soon as possible in 2004 ranged from 31% in the Netherlands to 67% in Spain. Such a preference for early retirement can depend on both financial and non financial factors. Non financial factors include working conditions, health status and mortality expectations. Economic or "monetary" factors essentially correspond to the magnitude of pension entitlements and how they depend upon retirement age. Entitlements that depend positively on retirement age should reduce the motivation to retire as soon as possible. This paper compares the role of these different factors by combining individual data from the Share survey with macroeconomic indicators of pension entitlements recently produced by the OECD. Health and work conditions come out as strong determinants of the preference for early retirement. Being generally satisfied with one's work leads to a drop of approximately 16 percentage points in the probability of wishing to retire as soon as possible. Declaring oneself in bad or very bad health has a positive effect on this probability of a comparable order of magnitude. However, these non financial factors do not significantly contribute to the explanation of cross-country differentials. Conversely, financial factors seem to have a lower impact at micro-level, but a higher one for the explanation of cross-country differentials.

Keywords: Retirement; Monetary factor; Health; Job satisfaction (search for similar items in EconPapers)
JEL-codes: I10 J26 J28 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2008-07, Revised 2008-07
New Economics Papers: this item is included in nep-age, nep-eec and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (24)

Downloads: (external link)
https://www.irdes.fr/EspaceAnglais/Publications/Wo ... irEuropCountries.pdf First version, 2008 (application/pdf)

Related works:
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:irh:wpaper:dt13

Access Statistics for this paper

More papers in Working Papers from IRDES institut for research and information in health economics Contact information at EDIRC.
Bibliographic data for series maintained by Jacques Harrouin (harrouin@irdes.fr).