The Retirement Decision in OECD Countries

Blöndal, Sveinbjörn; Scarpetta, Stéfano

doi:10.1787/565174210530

Cited by 129 publications

(37 citation statements)

References 25 publications

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“…Evidence shows that removing financial incentives to retire prior to the normal pension age and making pension systems more actuarially fair would have a substantial effect on the labor force participation rates of older workers (Blöndal and Scarpetta 1999;Börsch-Supan 2000;Duval 2003;Gruber and Wise 1998, 2004.…”

Section: Discussionmentioning

confidence: 99%

Quantifying policy tradeoffs to support aging populations

Scherbov¹,

Sanderson²,

Mamolo³

2014

DemRes

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BACKGROUNDCoping with aging populations is a challenge for most developed countries. Supporting non-working adults can create an unsustainable burden on those working. One way of dealing with this is to raise the normal pension age, but this has proven unpopular. A complementary approach is to raise the average labor force participation rate. These policies are generally more politically palatable because they often remove barriers, allowing people who would like to work to do so. OBJECTIVETo conceptualize and estimate the trade-off between pension age and labor force participation rate policies. METHODWe project the populations of European countries and apply different levels of labor force participation rates to the projected populations. We introduce the notion of a relative burden, which is the ratio of the fraction of the income of people in the labor market in 2050 that they transfer to adults out of the labor market to the same fraction in 2009. We use this indicator to investigate the trade-offs between changes in normal pension ages and the general level of labor force participation rates. RESULTSWe show that, in most European countries, a difference in policies that results in an increase in average labor force participation rates by an additional one to two percentage points by 2050 can substitute for a one-year increase in the normal pension age. This is important because, in many European countries, without additional increases in labor force participation rates, normal pension ages would have to be raised well above 68 by 2050 to keep the burden on those working manageable. CONCLUSIONBecause of anticipated increases in life expectancy and health at older ages as well as because of financial necessity, some mix of increases in pension ages and in labor force participation rates will be needed. Pension age changes by themselves will not be sufficient.

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Section: Discussionmentioning

confidence: 99%

Quantifying policy tradeoffs to support aging populations

Scherbov¹,

Sanderson²,

Mamolo³

2014

DemRes

View full text Add to dashboard Cite

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“…their adaptability, trainability and higher number of potential working years (Taylor & Walker, 1998). Moreover, in many countries unemployment-related benefit periods for senior workers are extended up to the pensionable age and the active job-search requirements are removed, turning their unemployment spell into de facto early retirement (Blöndal & Scarpetta, 1998).…”

Section: Pathways To Retirementmentioning

confidence: 99%

“…Bad health is considered as a legitimate reason to exit the labour market, even in work-oriented societies (Kohli & Rein, 1991), and disability schemes are relatively generous in most countries (Blöndal & Scarpetta, 1998), which creates moral hazard and spill-over problems as it makes it more attractive to get access to a disability scheme than to a less generous scheme (Gautier & Van der Klaauw, 2012).…”

Section: Pathways To Retirementmentioning

confidence: 99%

“…However, if this increase in future pension benefits does not exceed the extra costs of working longer (i.e. additional pension contributions and foregone pension benefits), there is an incentive to retire, or in other words, an implicit tax on work (Blöndal & Scarpetta, 1998).…”

Section: Incentives To Retirementioning

confidence: 99%

“…to pursue further education or training) by weighing the costs and benefits associated with this investment (Becker, 1993), having a higher education has many advantages. For instance, higher educated workers generally have higher wages and access to more stable jobs (Blöndal & Scarpetta, 1998) and less physically strenuous jobs. Research indicates that higher educated workers usually retire at a later age than lower educated workers, which is partly because they are less at risk of developing health problems such as musculoskeletal diseases (Blekesaune & Solem, 2005).…”

Section: Differences Across Countries and Specific Groups Of Peoplementioning

confidence: 99%

See 2 more Smart Citations

Labour Law, Social Norms and the Early Retirement Decision: An Empirical Study

2012

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The study examines the influence of values, social norms and labour law and social security institutions on the decision to exit the labour market and to give up job security and even some income by labour law and social security regulations appear to differ by gender but not by education or skill level. Social norms have a substantial effect which is however shown to be different for men and women in some instances and more important for the early retirement decision of the high skilled worker than the low-skilled worker, whereas some commonly shared values in society such as a high work ethos exerts a stronger effect on the low skilled workers' retirement decision.

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“Do I Stay or Do I Go?”—job Change and Labor Market Exit Intentions of Employees Providing Informal Care to Older Adults

et al. 2012

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We studied the effects of providing informal eldercare on the turnover intention of men and women in a group of workers who were also the main carers providing support to a dependent older person with substantial care needs. The intention of male and female workers to change jobs and exit the labor market is shaped by the different characteristics of informal caregiving. Time-based conflicts between informal care and paid work are associated with a higher relative risk of anticipating job changes for female workers. Flextime facilitates the job and labor market attachment of female workers with eldercare responsibilities. The intensity of personal care provided to an older relative is significantly positively related to male workers' relative risk of anticipated labor market exit. Care to an older person in need of supervision makes the labor market exit of female workers less likely, lending thus support to the idea of the respite effect of work.

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The Retirement Decision in OECD Countries

Cited by 129 publications

References 25 publications

Quantifying policy tradeoffs to support aging populations

Quantifying policy tradeoffs to support aging populations

Labour Law, Social Norms and the Early Retirement Decision: An Empirical Study

“Do I Stay or Do I Go?”—job Change and Labor Market Exit Intentions of Employees Providing Informal Care to Older Adults

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