Training Background and Early Retirement
AbstractSeveral studies show that employees with firm-specific skills are more likely to be covered by employer-sponsored pension schemes than workers with general skills. Therefore it can be expected that workers with firm-specific skills retire earlier. This paper tests this prediction using US data from the National Longitudinal Survey of Older Men. We find that workers who participated in firm-specific training in their early careers retire earlier than workers with a general training background. This indicates that shared investments in firm-specific training are embedded in implicit contracts that induce early retirement. The results remain robust when controlling for technological change and work commitment.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3504.
Length: 32 pages
Date of creation: May 2008
Date of revision:
Publication status: published as 'Training and retirement patterns' in: Applied Economics, 2013, 45 (15), 1991-1999
Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Find related papers by JEL classification:
- J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
- J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
This paper has been announced in the following NEP Reports:
- NEP-AGE-2008-07-14 (Economics of Ageing)
- NEP-ALL-2008-07-14 (All new papers)
- NEP-HRM-2008-07-14 (Human Capital & Human Resource Management)
- NEP-LAB-2008-07-14 (Labour Economics)
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.:
- Alan L. Gustman & Thomas L. Steinmeier & Olivia Mitchell, 1994. "The role of pensions in the labor market: A survey of the literature," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 47(3), pages 417-438, April.
- Hashimoto, Masanori, 1981. "Firm-Specific Human Capital as a Shared Investment," American Economic Review, American Economic Association, vol. 71(3), pages 475-82, June.
- Acemoglu, Daron & Pischke, Jörn-Steffen, 1996.
"Why do Firms Train? Theory and Evidence,"
CEPR Discussion Papers
1460, C.E.P.R. Discussion Papers.
- Daron Acemoglu & Jorn-Steffen Pischke, 1996. "Why Do Firms Train? Theory and Evidence," NBER Working Papers 5605, National Bureau of Economic Research, Inc.
- Acemoglu, D. & Pischki, J.S., 1996. "Why Do Firms Train? Theory and Evidence," Working papers 96-7, Massachusetts Institute of Technology (MIT), Department of Economics.
- James H. Stock & David A. Wise, 1988.
"Pensions, The Option Value of Work, and Retirement,"
NBER Working Papers
2686, National Bureau of Economic Research, Inc.
- Stock, James H & Wise, David A, 1990. "Pensions, the Option Value of Work, and Retirement," Econometrica, Econometric Society, vol. 58(5), pages 1151-80, September.
- Lazear, Edward P & Moore, Robert L, 1984. "Incentives, Productivity, and Labor Contracts," The Quarterly Journal of Economics, MIT Press, vol. 99(2), pages 275-96, May.
- Smith, Sharon P, 1991. "Ending Mandatory Retirement in the Arts and Sciences," American Economic Review, American Economic Association, vol. 81(2), pages 106-10, May.
- Kennan, John, 1979. "Bonding and the enforcement of labor contracts," Economics Letters, Elsevier, vol. 3(1), pages 61-66.
- Sarah Smith & James Banks, 2006.
"Retirement in the UK,"
The Centre for Market and Public Organisation
06/140, Department of Economics, University of Bristol, UK.
- Bartel, Ann P & Sicherman, Nachum, 1993. "Technological Change and Retirement Decisions of Older Workers," Journal of Labor Economics, University of Chicago Press, vol. 11(1), pages 162-83, January.
- Johnson, Richard W, 1996. "The Impact of Human Capital Investments on Pension Benefits," Journal of Labor Economics, University of Chicago Press, vol. 14(3), pages 520-54, July.
- Bingley, Paul & Lanot, Gauthier, 2004. "Employer pay policies, public transfers and the retirement decisions of men and women in Denmark," European Economic Review, Elsevier, vol. 48(1), pages 181-200, February.
- Orley Ashenfelter & David Card, 2002. "Did the Elimination of Mandatory Retirement Affect Faculty Retirement?," American Economic Review, American Economic Association, vol. 92(4), pages 957-980, September.
- Samwick, Andrew A., 1998.
"New evidence on pensions, social security, and the timing of retirement,"
Journal of Public Economics,
Elsevier, vol. 70(2), pages 207-236, November.
- Andrew A. Samwick, 1998. "New Evidence on Pensions, Social Security, and the Timing of Retirement," NBER Working Papers 6534, National Bureau of Economic Research, Inc.
- Chan, Sewin & Stevens, Ann Huff, 2004. "Do changes in pension incentives affect retirement? A longitudinal study of subjective retirement expectations," Journal of Public Economics, Elsevier, vol. 88(7-8), pages 1307-1333, July.
- Stevens, Margaret, 1994. "A Theoretical Model of On-the-Job Training with Imperfect Competition," Oxford Economic Papers, Oxford University Press, vol. 46(4), pages 537-62, October.
- Fella, Giulio, 2005. "Termination restrictions and investment in general training," European Economic Review, Elsevier, vol. 49(6), pages 1479-1499, August.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).
If references are entirely missing, you can add them using this form.