Working Life and Human Capital Investment: Causal Evidence from Pension Reform

Niklas Gohl (), Peter Haan (), Elisabeth Kurz () and Felix Weinhardt ()
Additional contact information
Niklas Gohl: DIW Berlin
Peter Haan: DIW Berlin
Elisabeth Kurz: Frontier Economics

No 12891, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper presents a life-cycle model with human capital investment during working life through training and provides a novel empirical test of human capital theory. We exploit a sizable pension reform across adjacent cohorts in a regression discontinuity setting and find that an increase in working life increases training. We discuss and test further predictions regarding the relation between initial schooling, training, and the reform effect, showing that only individuals with a college degree increase human capital investment. Our results speak to a large class of human capital models as well as policies extending or shortening working life.

Keywords: retirement policies; human capital; RDD (search for similar items in EconPapers)
JEL-codes: H21 J24 J26 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2020-01
New Economics Papers: this item is included in nep-age and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Published - published in: Labour Economics 2023, 84, 102426

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