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Hours of Work and Retirement Behavior

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Author Info

  • Machado, C. Sofia

    ()
    (Instituto Politécnico do Cávado e do Ave)

  • Portela, Miguel

    ()
    (University of Minho)

Abstract

Using a novel dataset from the 2006 Portuguese Labor Force Survey this paper examines the impact of a voluntary reduction in hours of work, before retirement, on the moment of exit from the labor force. If, as often suggested, flexibility in hours of work is a useful measure to postpone retirement, then a reduction in working hours should be associated with retirement at later ages. Results prove otherwise suggesting that reducing hours of work before retirement is associated with early exits from the labor force. A reduction in hours of work seems to signal the worker's wish to retire sooner rather than to announce the desire of remaining in the labor market. This result may enclose the need for some alternative policy strategies regarding working hours.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6270.

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Length: 35 pages
Date of creation: Jan 2012
Date of revision:
Handle: RePEc:iza:izadps:dp6270

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Keywords: aging; retirement; working hours; older workers;

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  1. David Dorn & Alfonso Sousa-Poza, 2005. "The Determinants of Early Retirement in Switzerland," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 141(II), pages 247-283, June.
  2. Hanoch, Giora & Honig, Marjorie, 1983. "Retirement, Wages, and Labor Supply of the Elderly," Journal of Labor Economics, University of Chicago Press, vol. 1(2), pages 131-51, April.
  3. Mario Cleves & William W. Gould & Roberto G. Gutierrez & Yulia Marchenko, 2010. "An Introduction to Survival Analysis Using Stata," Stata Press books, StataCorp LP, edition 3, number saus3, July.
  4. Gary Burtless & Joseph F. Quinn, 2000. "Retirement Trends and Policies to Encourage Work Among Older Americans," Boston College Working Papers in Economics 436, Boston College Department of Economics.
  5. Adams, Scott J., 2004. "Age discrimination legislation and the employment of older workers," Labour Economics, Elsevier, vol. 11(2), pages 219-241, April.
  6. Martins, Pedro S. & Novo, Alvaro A. & Portugal, Pedro, 2009. "Increasing the Legal Retirement Age: The Impact on Wages, Worker Flows and Firm Performance," IZA Discussion Papers 4187, Institute for the Study of Labor (IZA).
  7. Burtless, Gary & Moffitt, Robert A, 1985. "The Joint Choice of Retirement Age and Postretirement Hours of Work," Journal of Labor Economics, University of Chicago Press, vol. 3(2), pages 209-36, April.
  8. Michele Belloni & Rob Alessie, 2008. "Retirement Choices: New Evidence for Italy," CeRP Working Papers 73, Center for Research on Pensions and Welfare Policies, Turin (Italy).
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Cited by:
  1. Martin Huber & Michael Lechner & Conny Wunsch, 2013. "The Effect of Firms' Partial Retirement Policies on the Labour Market Outcomes of their Employees," CESifo Working Paper Series 4343, CESifo Group Munich.
  2. Ted Aranki & Corrado Macchiarelli, 2013. "Employment duration and shifts into retirement in the EU," LSE Research Online Documents on Economics 53190, London School of Economics and Political Science, LSE Library.

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