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Health and retirement: Heterogeneity in the responsiveness to pension incentives

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  • Hsu, De Fen
  • Morrill, Melinda
  • Pathak, Aditi

Abstract

Workers often time retirement around pension eligibility, yielding a strong instrument for retirement timing. By estimating the characteristics of the complier population, we find heterogeneity by individual health status in the responsiveness to pension-related financial incentives to retire. Workers in poor health do not uniformly retire earlier or later, but rather are less responsive overall to pension incentives. Thus, characterizing compliers may yield different conclusions than simple comparisons of means.

Suggested Citation

  • Hsu, De Fen & Morrill, Melinda & Pathak, Aditi, 2024. "Health and retirement: Heterogeneity in the responsiveness to pension incentives," Economics Letters, Elsevier, vol. 238(C).
    • Handle: RePEc:eee:ecolet:v:238:y:2024:i:c:s0165176524001605
    DOI: 10.1016/j.econlet.2024.111677
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    References listed on IDEAS

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    1. Richard Blundell & Jack Britton & Monica Costa Dias & Eric French, 2023. "The Impact of Health on Labor Supply near Retirement," Journal of Human Resources, University of Wisconsin Press, vol. 58(1), pages 282-334.
    2. Clémentine Garrouste & Elsa Perdrix, 2022. "Is there a consensus on the health consequences of retirement? A literature review," Journal of Economic Surveys, Wiley Blackwell, vol. 36(4), pages 841-879, September.
    3. Abadie, Alberto, 2003. "Semiparametric instrumental variable estimation of treatment response models," Journal of Econometrics, Elsevier, vol. 113(2), pages 231-263, April.
    4. Abadie A., 2002. "Bootstrap Tests for Distributional Treatment Effects in Instrumental Variable Models," Journal of the American Statistical Association, American Statistical Association, vol. 97, pages 284-292, March.
    5. Papke, Leslie E., 2019. "Retirement choices by state and local public sector employees: the role of eligibility and financial incentives," Journal of Pension Economics and Finance, Cambridge University Press, vol. 18(4), pages 515-528, October.
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    More about this item

    Keywords

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    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I10 - Health, Education, and Welfare - - Health - - - General

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