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Non-financial determinants of retirement

  • Frank van Erp

    ()

  • Niels Vermeer

    ()

  • Daniel van Vuuren

    ()

This paper first confronts the observed aggregate retirement pattern in the Netherlands with predictions of traditional economic models of retirement. The retirement peaks observed in the data cannot entirely be reconciled with models putting financial incentives central to individual decision-making. After surveying different explanations from psychology and sociology, the paper concludes that social norms, default options, and reference-dependent utility are likely explanations for the observed individual propensity to retire at standard retirement ages. Most empirical evidence on these factors is, however, not related to the retirement age, so that a great deal of research remains to be done.

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Paper provided by CPB Netherlands Bureau for Economic Policy Analysis in its series CPB Discussion Paper with number 243.

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Date of creation: May 2013
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Handle: RePEc:cpb:discus:243
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