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Financial Incentives and the Timing of Retirement: Evidence from Switzerland

Author

Listed:
  • Hanel, Barbara

    () (Melbourne Institute of Applied Economic and Social Research)

  • Riphahn, Regina T.

    () (University of Erlangen-Nuremberg)

Abstract

We use reforms in the Swiss public retirement system to identify the responsiveness of retirement timing to financial incentives. A permanent reduction of retirement benefits by 3.4 percent induces more than 70 percent of females to postpone their retirement. The responsiveness of male workers, who undergo a different treatment, is lower.

Suggested Citation

  • Hanel, Barbara & Riphahn, Regina T., 2006. "Financial Incentives and the Timing of Retirement: Evidence from Switzerland," IZA Discussion Papers 2492, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp2492
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    References listed on IDEAS

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    1. Courtney Coile & Jonathan Gruber, 2001. "Social Security Incentives for Retirement," NBER Chapters,in: Themes in the Economics of Aging, pages 311-354 National Bureau of Economic Research, Inc.
    2. Chan, Sewin & Stevens, Ann Huff, 2004. "Do changes in pension incentives affect retirement? A longitudinal study of subjective retirement expectations," Journal of Public Economics, Elsevier, vol. 88(7-8), pages 1307-1333, July.
    3. Lumsdaine, Robin L. & Mitchell, Olivia S., 1999. "New developments in the economic analysis of retirement," Handbook of Labor Economics,in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 49, pages 3261-3307 Elsevier.
    4. Courtney Coile & Jonathan Gruber, 2000. "Social Security and Retirement," NBER Working Papers 7830, National Bureau of Economic Research, Inc.
    5. Monika Bütler, 2002. "The Political Feasibility of Increasing the Retirement Age: Lessons from a Ballot on the Female Retirement Age," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 9(4), pages 349-365, August.
    6. Krueger, Alan B & Pischke, Jorn-Steffen, 1992. "The Effect of Social Security on Labor Supply: A Cohort Analysis of the Notch Generation," Journal of Labor Economics, University of Chicago Press, vol. 10(4), pages 412-437, October.
    7. Asch, Beth & Haider, Steven J. & Zissimopoulos, Julie, 2005. "Financial incentives and retirement: evidence from federal civil service workers," Journal of Public Economics, Elsevier, vol. 89(2-3), pages 427-440, February.
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    Cited by:

    1. Frank van Erp & Niels Vermeer & Daniël van Vuuren, 2013. "Non-financial determinants of retirement," CPB Discussion Paper 243, CPB Netherlands Bureau for Economic Policy Analysis.
    2. Kallweit Manuel, 2009. "Rentenreform und Rentenzugangsentscheidung – Eine numerische Gleichgewichtsanalyse / Pension Reform and Endogenous Retirement – a Computable General Equilibrium Analysis," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 229(4), pages 426-449, August.
    3. Lees, Kirdan, 2013. "Golden years? The impacts of New Zealand’s ageing on wages, interest rates, wealth and macroeconomy," NZIER Working Paper 2013/1, New Zealand Institute of Economic Research.

    More about this item

    Keywords

    labor force exit; social security; incentives; retirement insurance; natural experiment; Switzerland;

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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