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Pension Incentives, Labor Supply and Heterogeneous Pension Systems

  • Holen, Dag S.

    (Ragnar Frisch Centre for Economic Research)

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    People with an uncertain health condition might face a double worry. They fear to get disabled, and if they are disabled, that they will receive a low pension. To keep their health they should work less. To improve their disability pension they should work more. This paper demonstrates that the latter effect is the strongest empirically. Thus to protect one self against the income loss of a bad event, the bad event is more likely to happen. Comparing register data from disabled and non-disabled individuals shows that being disabled increases income in the last year before the time of disablement. Further, more generous pension systems increase pre-disablement income even more.

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    File URL: https://www.sv.uio.no/econ/english/research/unpublished-works/working-papers/pdf-files/2008/Memo-18-2008.pdf
    Download Restriction: no

    Paper provided by Oslo University, Department of Economics in its series Memorandum with number 18/2008.

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    Length: 26 pages
    Date of creation: 27 Mar 2007
    Date of revision:
    Handle: RePEc:hhs:osloec:2008_018
    Contact details of provider: Postal: Department of Economics, University of Oslo, P.O Box 1095 Blindern, N-0317 Oslo, Norway
    Phone: 22 85 51 27
    Fax: 22 85 50 35
    Web page: http://www.oekonomi.uio.no/indexe.html
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