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Retirement coordination and leisure complementarity

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  • Merkurieva, Irina

Abstract

Empirical evidence suggests that in a large fraction of working couples spouses retire within a short period of time. This retirement coordination is frequently attributed to leisure complementarities. Contrary to this view, I find strong substitutability between the leisure of the two household members. Using a dynamic programming model of optimal retirement and labor supply decisions, I further show that high levels of retirement coordination can be observed even in the absence of leisure complementarity. Retirement coordination is higher in the households with more equality in the earnings profiles and utility derived from the leisure of their individual members.

Suggested Citation

  • Merkurieva, Irina, 2023. "Retirement coordination and leisure complementarity," Labour Economics, Elsevier, vol. 85(C).
    • Handle: RePEc:eee:labeco:v:85:y:2023:i:c:s0927537123001069
    DOI: 10.1016/j.labeco.2023.102431
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    References listed on IDEAS

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    More about this item

    Keywords

    Retirement; Leisure complementarity; Intertemporal household choice;
    All these keywords.

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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