Working Paper: CEPR ID: DP8510
Authors: Stefan Staubli; Josef Zweimller
Abstract: This paper studies how an increase in the minimum retirement age affects the labor market behavior of older workers. Between 2000 and 2006 the Austrian government gradually increased the early retirement age from 60 to 62.2 for men and from 55 to 57.2 for women. Using administrative data on the universe of Austrian private-sector employees, the results from the empirical analysis suggest that this policy change reduced retirement by 19 percentage points among affected men and by 25 percentage points among affected women. The decline in retirement was accompanied by a sizeable increase in employment of 7 percentage points among men and 10 percentage points among women, but had also a important spillover effects into the unemployment insurance program. Specifically, the unemployment rate increased by 10 percentage points among men and 11 percentage points among women. In contrast, the policy change had only a small impact on the share of individuals claiming disability or partial retirement benefits.
Keywords: early retirement; labor supply; policy reform; retirement age
JEL Codes: J14; J26
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Increase in the early retirement age (J26) | Reduced retirement benefits claiming among affected men (J26) |
| Increase in the early retirement age (J26) | Increased employment among men (J49) |
| Increase in the early retirement age (J26) | Reduced retirement benefits claiming among affected women (J26) |
| Increase in the early retirement age (J26) | Increased employment among women (J21) |
| Increase in the early retirement age (J26) | Rise in registered unemployment for men (J64) |
| Increase in the early retirement age (J26) | Rise in registered unemployment for women (J79) |
| Increase in the early retirement age (J26) | Minimal impact on disability enrollment (H53) |
| Increase in the early retirement age (J26) | Increase in partial retirement enrollment (J26) |