Job-Search Effort, Retirement Decision and Pension Reform: A Wage Bargaining Investigation
AbstractThis paper studies the impact of wage bargaining on endogenous labor market participation of older workers and revisits the effects of pension reforms. Our main contribution to the literature on retirement is to show that in the context of wage flexibility, when wages are bargained, the financial gain associated with the incentive schemes to delay retirement is shared between workers and firms. In contrast, previous works on actuarially fair pension policy conventionally assume that these incentives are exclusively received by workers. Then, our model emphasizes the positive effects of incentives to delay retirement when the bargaining power of workers is positive. These incentive schemes do not only encourage employed individuals to delay their retirement, but also make searching more attractive to non-employed workers.
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Bibliographic InfoArticle provided by AccessEcon in its journal Economics Bulletin.
Volume (Year): 29 (2009)
Issue (Month): 2 ()
Contact details of provider:
job search; retirement age; wage bargaining; incentives to work longer;
Find related papers by JEL classification:
- H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
- J2 - Labor and Demographic Economics - - Demand and Supply of Labor
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