Working Paper: NBER ID: w20035
Authors: Alain Jousten; Mathieu Lefebvre; Sergio Perelman
Abstract: Many Belgian retire well before the statutory retirement age. Numerous exit routes from the labor force can be identified: old-age pensions, conventional early retirement, disability insurance, and unemployment insurance are the most prominent ones. We analyze the retirement decision of Belgian workers adopting an option value framework, and pay special attention to the role of health status. We estimate probit models of retirement using data from SHARE. The results show that health and incentives matter in the decision to exit from the labor market. Based on these results, we simulate the effect of potential reforms on retirement.
Keywords: health status; disability insurance; retirement incentives; Belgium
JEL Codes: H55; J21; J26
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| health status (I12) | retirement probability (J26) |
| retirement incentives (J26) | retirement probability (J26) |
| age (J14) | retirement probability (J26) |
| education (I29) | retirement probability (J26) |
| active spouse (J22) | retirement probability (J26) |
| household wealth (D14) | retirement probability (J26) |