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Retirement Behaviour in Austria: Effects of Incentives on Old‐Age Labour Supply

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  • Tibor Hanappi
  • Wolfgang Nagl

Abstract

We provide an extensive analysis of retirement behaviour in Austria with a special focus on the role of incentives delivered by the tax and benefit system in determining individual retirement decisions. A comprehensive microsimulation model of the Austrian pension system is applied to calculate retirement benefit entitlements and forward‐looking incentive measures (social security wealth, accrual rate, peak and option values) on an individual basis. We use the calculated incentive measures as the main explanatory variables in probit models to explain retirement decisions. We base our microsimulation and estimations on an extensive administrative Austrian data set. These data contain information on more than 300,000 new retirees from the period 2001–11. We provide robust evidence that incentive measures are well suited to explaining individual retirement decisions.

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  • Tibor Hanappi & Wolfgang Nagl, 2019. "Retirement Behaviour in Austria: Effects of Incentives on Old‐Age Labour Supply," Fiscal Studies, John Wiley & Sons, vol. 40(3), pages 301-328, September.
    • Handle: RePEc:wly:fistud:v:40:y:2019:i:3:p:301-328
    DOI: 10.1111/1475-5890.12193
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    1. Thomas Url, 2012. "Die Rolle von Lebensversicherungen in der betrieblichen Altersvorsorge," WIFO Studies, WIFO, number 45558, April.
    2. Jonathan Gruber & David A. Wise, 2004. "Social Security Programs and Retirement around the World: Micro-Estimation," NBER Books, National Bureau of Economic Research, Inc, number grub04-1, July.
    3. Monika Queisser & Edward Whitehouse, 2006. "Neutral or Fair?: Actuarial Concepts and Pension-System Design," OECD Social, Employment and Migration Working Papers 40, OECD Publishing.
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