Integration or Isolation? The Impact of Retirement on Social Capital

Kadir Atalay, Anita Staneva and Rong Zhu ()
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Kadir Atalay: University of Sydney, Australia
Anita Staneva: Griffith University, Australia
Rong Zhu: Flinders University, Australia

No 18396, IZA Discussion Papers from IZA Network @ LISER

Abstract: This paper examines the causal impact of retirement on social capital using nationally representative Australian panel data. Exploiting the eligibility age for the Age Pension, we find that retirement significantly enhances social capital by increasing social connectedness and community involvement. These gains improve physical and mental health, with effects comparable to those of physical activity. However, older individuals’ perceptions of social relationships remain unchanged. Our findings highlight a key policy trade-off: while raising the retirement age may boost labor force participation, it may reduce opportunities for meaningful social engagement and, in turn, undermine the health of older adults.

Keywords: retirement; social capital; hHealth; public pension (search for similar items in EconPapers)
JEL-codes: H55 I10 I31 J26 (search for similar items in EconPapers)
Date: 2026-03
New Economics Papers: this item is included in nep-lma and nep-soc
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Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp18396

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