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Fatal Attraction? Extended Unemployment Benefits, Labor Force Exits, and Mortality

In: Inequality and Public Policy, Trans-Atlantic Public Economics Seminar 2018

Author

Listed:
  • Andreas Kuhn
  • Stefan Staubli
  • Jean-Philippe Wuellrich
  • Josef Zweimüller

Abstract

We estimate the causal effect of a permanent and premature exit from the labor force on mortality. To overcome the problem of negative health selection into retirement, we exploit a policy change in Austria's unemployment insurance system that allows older eligible workers to exit the labor force 3 years earlier relative to comparable non-eligible workers. Using administrative data with precise information on mortality and retirement, we find that the policy change induces eligible men (women) to retire 5.5 (8.5) months earlier. Instrumental variable estimates show that for men retiring one year earlier causes a 5.5% increase in the risk of premature death and a 2.2 months reduction in the age at death but has no significant effect for women.
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Suggested Citation

  • Andreas Kuhn & Stefan Staubli & Jean-Philippe Wuellrich & Josef Zweimüller, 2018. "Fatal Attraction? Extended Unemployment Benefits, Labor Force Exits, and Mortality," NBER Chapters, in: Inequality and Public Policy, Trans-Atlantic Public Economics Seminar 2018, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberch:14151
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    Cited by:

    1. Antoine Bozio & Clémentine Garrouste & Elsa Perdrix, 2021. "Impact of later retirement on mortality: Evidence from France," Health Economics, John Wiley & Sons, Ltd., vol. 30(5), pages 1178-1199, May.
    2. Todd Morris & Benoit Dostie, 2023. "Graying and staying on the job: The welfare implications of employment protection for older workers," Cahiers de recherche / Working Papers 15, Institut sur la retraite et l'épargne / Retirement and Savings Institute.
    3. Kyyrä, Tomi & Pesola, Hanna, 2020. "Long-term effects of extended unemployment benefits for older workers," Labour Economics, Elsevier, vol. 62(C).
    4. Mattia Filomena & Matteo Picchio, 2023. "Retirement and health outcomes in a meta‐analytical framework," Journal of Economic Surveys, Wiley Blackwell, vol. 37(4), pages 1120-1155, September.
    5. Matteo Picchio & Jan C. van Ours, 2020. "Mental Health Effects of Retirement," De Economist, Springer, vol. 168(3), pages 419-452, September.
    6. Black, Bernard & French, Eric & McCauley, Jeremy & Song, Jae, 2024. "The effect of disability insurance receipt on mortality," Journal of Public Economics, Elsevier, vol. 229(C).
    7. Mohamed Ali Ben Halima & Camille Ciriez & Malik Koubi & Ali Skalli, 2022. "Retarder l’âge d’ouverture des droits à la retraite provoque-t-il un déversement de l’assurance-retraite vers l’assurance-maladie ? L’effet de la réforme des retraites de 2010 sur l’absence-maladie," Working Papers hal-03509628, HAL.
    8. José Ignacio Garcia-Pérez & Manuel Serrano-Alarcón & Judit Vall-Castelló, 2024. "Long-term unemployment subsidies and middle-aged disadvantaged workers’ health," Journal of Population Economics, Springer;European Society for Population Economics, vol. 37(1), pages 1-24, March.
    9. Jan C. van Ours, 2022. "How Retirement Affects Mental Health, Cognitive Skills and Mortality; An Overview of Recent Empirical Evidence," De Economist, Springer, vol. 170(3), pages 375-400, August.
    10. Riphahn, Regina T. & Schrader, Rebecca, 2023. "Reforms of an early retirement pathway in Germany and their labor market effects," Journal of Pension Economics and Finance, Cambridge University Press, vol. 22(3), pages 304-330, July.
    11. Yuanrong Xu, 2023. "The effect of retirement on health and mortality in the United States," Journal of Population Research, Springer, vol. 40(2), pages 1-22, June.
    12. Lalive, Rafael & Magesan, Arvind & Staubli, Stefan, 2020. "The Impact of Social Security on Pension Claiming and Retirement: Active vs. Passive Decisions," IZA Discussion Papers 13537, Institute of Labor Economics (IZA).
    13. Eibich, Peter & Goldzahl, Léontine, 2021. "Does retirement affect secondary preventive care use? Evidence from breast cancer screening," Economics & Human Biology, Elsevier, vol. 43(C).
    14. Xu, Yuanrong & Tong, Bin, 2024. "Understanding the heterogeneous health effect of retirement by tracking daily activities," The Journal of the Economics of Ageing, Elsevier, vol. 29(C).
    15. Seonghoon Kim & Kanghyock Koh, 2020. "Does Early Access To Pension Wealth Improve Health?," Economic Inquiry, Western Economic Association International, vol. 58(4), pages 1783-1794, October.
    16. Terhi Ravaska, 2023. "Do reduced working hours for older workers have health consequences and prolong work careers?," Working Papers 6, Finnish Centre of Excellence in Tax Systems Research.
    17. 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.
    18. Fontana, Dario & Ardito, Chiara & Leombruni, Roberto & Strippoli, Elena & d’Errico, Angelo, 2024. "Does the time spent in retirement improve health? An IV-Poisson assessment on the incidence of cardiovascular diseases," Social Science & Medicine, Elsevier, vol. 354(C).
    19. Mohamed Ali Ben Halima & Camille Ciriez & Malik Koubi & Ali Skalli, 2021. "Retarder l’âge d’ouverture des droits à la retraite provoque-t-il un déversement de l’assurance-retraite vers l’assurance-maladie ? L’effet de la réforme des retraites de 2010 sur l’absence-maladie," TEPP Research Report 2021-13, TEPP.
    20. Megan M. Reynolds & Patricia A. Homan, 2023. "Income Support Policy Packages and Birth Outcomes in U.S. States: An Ecological Analysis," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 42(4), pages 1-24, August.
    21. Chen, Fengming & Wakabayashi, Midori & Yuda, Michio, 2024. "The impact of retirement on health: Empirical evidence from the change in public pensionable age in Japan," The Journal of the Economics of Ageing, Elsevier, vol. 28(C).
    22. Inukai, Shinya, 2025. "The impacts of raising the public pension eligibility age on time allocation of elderly people: Evidence from Japan," Journal of Economic Behavior & Organization, Elsevier, vol. 233(C).

    More about this item

    JEL classification:

    • I10 - Health, Education, and Welfare - - Health - - - General
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • 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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