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The sooner, the better? Analyzing preferences for early retirement in European countries

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Author Info
Didier Blanchet () (INSEE institut national de la statistique et des études économiques)
Thierry Debrand () (IRDES institut for research and information in health economics)

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Abstract

Individual preferences concerning retirement age are strongly differentiated both within and between countries. According to the Share survey, the proportion of workers aged from 50 to 65 who wished to retire as soon as possible in 2004 ranged from 31% in the Netherlands to 67% in Spain. Such a preference for early retirement can depend on both financial and non financial factors. Non financial factors include working conditions, health status and mortality expectations. Economic or "monetary" factors essentially correspond to the magnitude of pension entitlements and how they depend upon retirement age. Entitlements that depend positively on retirement age should reduce the motivation to retire as soon as possible. This paper compares the role of these different factors by combining individual data from the Share survey with macroeconomic indicators of pension entitlements recently produced by the OECD. Health and work conditions come out as strong determinants of the preference for early retirement. Being generally satisfied with one's work leads to a drop of approximately 16 percentage points in the probability of wishing to retire as soon as possible. Declaring oneself in bad or very bad health has a positive effect on this probability of a comparable order of magnitude. However, these non financial factors do not significantly contribute to the explanation of cross-country differentials. Conversely, financial factors seem to have a lower impact at micro-level, but a higher one for the explanation of cross-country differentials.

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File URL: http://www.irdes.fr/EspaceAnglais/Publications/WorkingPapers/DT13SoonerBetterAnalysingPrefRetirEuropCountries.pdf
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Publisher Info
Paper provided by IRDES institut for research and information in health economics in its series Working Papers with number DT13.

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Length: 26 pages
Date of creation: Jul 2008
Date of revision: Jul 2008
Handle: RePEc:irh:wpaper:dt13

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Related research
Keywords: Retirement; Monetary factor; Health; Job satisfaction;

Other versions of this item:

Find related papers by JEL classification:
J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy
I10 - Health, Education, and Welfare - - Health - - - General
J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Mélika Ben Salem & Antoine Bozio & Didier Blanchet & Muriel Roger, 2008. "Labor force participation by the elderly and employment of the young: The case of France," PSE Working Papers 2008-57, PSE (Ecole normale supérieure). [Downloadable!]
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