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Title: The Effects of the Early Retirement Age on Retirement Decisions

Author(s): Dayanand S. Manoli and Andrea Weber

Publication Date: September 2016

Keyword(s): early retirement age, pension reform and regression kink design

Programme Area(s): Labour Economics and Public Economics

Abstract: We present quasi-experimental evidence on the effects of increasing the Early Retirement Age (ERA) on older workers' retirement decisions. The analysis is based on social security reforms in Austria in 2000 and 2004, and administrative data allows us to distinguish between pension claims and job exits. Using a Regression Kink Design, we estimate that, within a birth cohort, a 1.0 year increase in the ERA leads to a 0.4 year increase in the average job exiting age and a 0.5 year increase in the average pension claiming age. When the ERA increases, many older workers remain in their jobs longer.

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Bibliographic Reference

Manoli, D and Weber, A. 2016. 'The Effects of the Early Retirement Age on Retirement Decisions'. London, Centre for Economic Policy Research. http://www.cepr.org/active/publications/discussion_papers/dp.php?dpno=11491