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Trends in Social Security Incentives in Belgium

Author

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  • Anne-Lore Fraikin
  • Alain Jousten
  • Mathieu Lefebvre

Abstract

In Belgium, a series of social security reforms have been implemented over the years with the overarching goal of increasing the labor force participation through better work incentives. Using individual-level administrative data, the paper studies the impact of those incentive-based reforms on observed changes in older workers’ employment patterns. We investigate how social security incentives and particularly their changes over time can explain the retirement decision. We calculate indicators of benefit entitlement and derive retirement incentive measures. Using micro-estimation techniques, we find that more generous retirement provision contribute to earlier retirement. Counterfactual reform simulations show strongly incentivizing effects at lower ages and more mixed results at higher ages – particularly for men.

Suggested Citation

  • Anne-Lore Fraikin & Alain Jousten & Mathieu Lefebvre, 2023. "Trends in Social Security Incentives in Belgium," NBER Working Papers 31552, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:31552
    Note: AG
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    1. PESTIEAU, Pierre & STIJNS, Jean-Philippe, 1999. "Social security and retirement in Belgium," LIDAM Reprints CORE 1374, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Alain Jousten & Sergio Perelman & Fabio Sigismondi & Ekaterina Tarantchenko, 2012. "Accrued Pension Rights in Belgium: Micro-Simulation of Reforms," International Journal of Microsimulation, International Microsimulation Association, vol. 5(2), pages 22-39.
    3. Arthur Seibold, 2021. "Reference Points for Retirement Behavior: Evidence from German Pension Discontinuities," American Economic Review, American Economic Association, vol. 111(4), pages 1126-1165, April.
    4. Alain Jousten & Mathieu Lefebvre, 2013. "Retirement Incentives in Belgium: Estimations and Simulations Using SHARE Data," De Economist, Springer, vol. 161(3), pages 253-276, September.
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    More about this item

    JEL classification:

    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • 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

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