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Mind the (narrowing) gender gap: Implications of labour market changes for EU pension sustainability

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  • Fernández-Bastidas, Rocío
  • Pycroft, Jonathan

Abstract

Gender disparities in the labour market in terms of employment rates and wages are widespread in EU countries. Historically, these gender gaps have been narrowing, significantly influencing the macroeconomy. This study employs a dynamic general equilibrium model populated by overlapping generations of men and women to evaluate the economic consequences of these trends continuing over the coming decades. We conduct a cross-country analysis focused on the fiscal sustainability of public pension systems. Our findings suggest that a continued reduction in gender gaps in the labour market could significantly mitigate the fiscal impact of population ageing. Quantitatively, the effects are comparable to reforms that increase the retirement age.

Suggested Citation

  • Fernández-Bastidas, Rocío & Pycroft, Jonathan, 2025. "Mind the (narrowing) gender gap: Implications of labour market changes for EU pension sustainability," Economic Modelling, Elsevier, vol. 151(C).
    • Handle: RePEc:eee:ecmode:v:151:y:2025:i:c:s0264999325001804
    DOI: 10.1016/j.econmod.2025.107185
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    Keywords

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    JEL classification:

    • D15 - Microeconomics - - Household Behavior - - - Intertemporal Household Choice; Life Cycle Models and Saving
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination

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