Working Paper: NBER ID: w17055
Authors: Luc Behaghel; Didier Blanchet; Thierry Debrand; Muriel Roger
Abstract: The French pattern of early transitions out of employment is basically explained by the low age at "normal" retirement and by the importance of transitions through unemployment insurance and early-retirement schemes before access to normal retirement. These routes have exempted French workers from massively relying on disability motives for early exits, contrarily to the situation that prevails in some other countries where normal ages are high, unemployment benefits low and early-retirement schemes almost non-existent. Yet the role of disability remains interesting to examine in the French case, at least for prospective reasons in a context of decreasing generosity of other programs.\n\nThe study of the past reforms of the pension system underlines that disability routes have often acted as a substitute to other retirement routes. Changes in the claiming of invalidity benefits seem to match changes in pension schemes or controls more than changes in such health indicators as the mortality rates. However, our results suggest that increases in average health levels over the past two decades have come along with increased disparities. In that context, less generous pensions may induce an increase in the claiming of invalidity benefits partly because of substitution effects, but also because the share of people with poor health increases.
Keywords: disability; social security; pension reforms; France; early retirement
JEL Codes: H55; H63; J14; J26
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| lower retirement ages and accessible unemployment benefits (J26) | reduced disability claims (G52) |
| less generous pensions (H55) | higher claims for invalidity benefits (H55) |
| tighter controls on sickness benefits after 2003 (H53) | significant drop in use of these benefits among older workers (J26) |
| increase in body mass index (BMI) (I14) | influence on retirement pathways (J26) |
| 1993 pension reform (H55) | increased use of disability pensions (H55) |