Firms and Early Retirement: Offers That One Does Not Refuse

Lutz Bellmann () and Florian Janik ()
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Lutz Bellmann: Institute for Employment Research (IAB), Nuremberg
Florian Janik: Institute for Employment Research (IAB), Nuremberg

No 2931, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: According to the Hutchens (1999) model, early retirement is not explained as a result of maximizing expected individual utility but rather as a demand-side phenomenon arising from a firm’s profit-maximizing behaviour. Firms enter into contracts with their employees that include clauses about early retirement. In response to demand or technological shocks, workers receive retirement offers from their employers which cannot be rejected by rational actors. Using the IAB Establishment Panel 2003-2006, the relationship between indicators of demand and technological shocks and the incidence and amount of early retirement is analysed. The results provide general support to the Hutchens model.

Keywords: (involuntary) early retirement; labour demand; panel data (search for similar items in EconPapers)
JEL-codes: J14 J21 J23 J26 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2007-07
New Economics Papers: this item is included in nep-age, nep-bec and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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