Retirement Decisions of Older Czech Male Workers
I analyze the effects associated with the introduction of the earnings test on older Czech males' labor supply in 1996. Using data from the Labor Force Survey, I apply a difference-in-differences estimator to measure the effect of the policy change in the Czech pension scheme using a sample of retired males aged 60 to 64 in 1995 and 1996. I use an age group not affected by the earnings test to separate the effect associated with the implementation of the earnings test. Correcting for sample selection, results indicate that the earnings test decreases the labor supply of retired males affected by the policy change. Their participation reduces by 7.7 percentage points, while hours of work decline by 4.8 hours per week. The response to the earnings test is moderately lower after controlling for the announcement of the policy change. The pecuniary value of the labor supply drop was negligible for the state in 1996, but increased significantly between 1996 and 2000.
|Date of creation:||Nov 2001|
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- Edward Whitehouse, 1990. "The abolition of the pensions 'earnings rule'," Fiscal Studies, Institute for Fiscal Studies, vol. 11(3), pages 55-70, August.
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Econometric Society, vol. 47(1), pages 153-161, January.
- Leora Friedberg, 1999.
"The Labor Supply Effects of the Social Security Earnings Test,"
NBER Working Papers
7200, National Bureau of Economic Research, Inc.
- Leora Friedberg, 2000. "The Labor Supply Effects of the Social Security Earnings Test," The Review of Economics and Statistics, MIT Press, vol. 82(1), pages 48-63, February.
- Burtless, Gary & Moffitt, Robert A, 1985. "The Joint Choice of Retirement Age and Postretirement Hours of Work," Journal of Labor Economics, University of Chicago Press, vol. 3(2), pages 209-236, April.
- Baker, Michael & Benjamin, Dwayne, 1999. "How do retirement tests affect the labour supply of older men?," Journal of Public Economics, Elsevier, vol. 71(1), pages 27-51, January.
- White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-838, May.
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