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The Incentive Effects of Minimum Pensions: extended version

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  • Sergi Jiménez-Martín

Abstract

The minimum pension program is one of the key welfare programs in many developing and developed countries and a key influence in retirement of low income workers or workers with intermittent working careers. The main purpose of minimum benefits programs is to guarantee a minimum standard of living after retirement. In general minimum contributory pensions that are only made available after the normal retirement age have little (but size- able) incentives effect in at least low incomer workers. Alternatively minimum contributory benefits made available at the early retirement age can generate substantial incentive effects on transitions to retirement of employed and unemployed workers. The importance of this effect critically depends upon both the eligibility conditions and the generosity of the mini- mum pension, that is, in the relationship between the guaranteed minimum pension and the average or the minimum wage.

Suggested Citation

  • Sergi Jiménez-Martín, 2014. "The Incentive Effects of Minimum Pensions: extended version," Working Papers 2014-04, FEDEA.
  • Handle: RePEc:fda:fdaddt:2014-04
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    File URL: http://documentos.fedea.net/pubs/dt/2014/dt-2014-04.pdf
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    References listed on IDEAS

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    1. Brücker, Herbert & Bertoli, Simone & Fernández-Huertas Moraga, Jesús, 2013. "The European Crisis and Migration to Germany: Expectations and the Diversion of Migration Flows," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79693, Verein für Socialpolitik / German Economic Association.
    2. Samwick, Andrew A., 1998. "New evidence on pensions, social security, and the timing of retirement," Journal of Public Economics, Elsevier, vol. 70(2), pages 207-236, November.
    3. Danzer, Alexander M., 2010. "Retirement Responses to a Generous Pension Reform: Evidence from a Natural Experiment in Eastern Europe," IZA Discussion Papers 4726, Institute for the Study of Labor (IZA).
    4. Robert Fenge & Pierre Pestieau, 2005. "Social Security and Early Retirement," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262062496, January.
    5. Jean-Olivier Hairault & Francois Langot & Thepthida Sopraseuth, 2010. "Distance to Retirement and Older Workers' Employment: The Case for Delaying the Retirement Age," Journal of the European Economic Association, MIT Press, vol. 8(5), pages 1034-1076, September.
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Regreso al futuro: ¿jubilación anticipada voluntaria a los 60?
      by Sergi Jiménez in Nada Es Gratis on 2014-07-18 11:00:33

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