Voluntary Job Separations and Traditional versus Flexible Workplace Saving Plans: Evidence from Canada

Tony Fang and Derek Messacar ()
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Derek Messacar: Memorial University of Newfoundland

No 12262, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper provides new insights into the longstanding empirical issue of whether the type of workplace saving plan (a "traditional" registered pension plan or RPP, a "flexible" group registered retirement savings plan or group RRSP, and a "hybrid" arrangement of the two) affects employee voluntary job separations. We use a Canadian employer–employee matched dataset that provides information on both job transitions and the types of workplace saving plans being held by employees and offered by employers. This dataset allows us to control for employee self-selection and firm fixed effects. The standard prediction from implicit contract theory suggests that traditional pensions reduce quit rates but flexible plans have little effect due to their portability. The results are partially consistent with this prediction. Implications of these findings for current public policy are discussed.

Keywords: self-selection; fixed effects; voluntary job separation; traditional pension; flexible retirement saving plan; implicit contract theory (search for similar items in EconPapers)
JEL-codes: J26 J32 J63 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2019-03
New Economics Papers: this item is included in nep-age and nep-lma
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Forthcoming - published in: Canadian Public Policy, 2019, 45 (2), 239-261.

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