Pension plans and retirement incentives

Richard Disney and Edward Whitehouse ()

No 20851, Social Protection Discussion Papers and Notes from The World Bank

Abstract: This paper aims to examine the impact of type of pension scheme on retirement behavior. Section 1 describes a simple, theoretical model of optimal retirement. Section 2 introduces an empirical model of a simple retirement savings plan, or defined contribution pension scheme. Section 3 compares this with a defined benefit scheme. Sections4 and 5 examine the effect of these pension plans on work incentives. The following three sections extend the basic model to introduce'real world'features of pension plans. Section 9 examines the policy implications of the results and sets out anagenda for future research in this area. The results show a powerful incentive to leave work at the earliest possible age in defined benefit plans. Defined contribution plans, in contrast, encourage people to remain in work longer.

Keywords: Wages; Compensation&Benefits; Youth and Governance; Economic Theory&Research; Environmental Economics&Policies; Pensions&Retirement Systems (search for similar items in EconPapers)
Date: 1999-08-31
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www-wds.worldbank.org/servlet/WDSContentSer ... d/PDF/multi_page.pdf (application/pdf)

Related works:
Working Paper: Pension plans and retirement incentives (1999)
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:wbk:hdnspu:20851

Access Statistics for this paper

More papers in Social Protection Discussion Papers and Notes from The World Bank 1818 H Street, N.W., Washington, DC 20433. Contact information at EDIRC.
Bibliographic data for series maintained by Aaron F Buchsbaum ().