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Pension reform, retirement, and life-cycle unemployment
Journal
International Tax and Public Finance
ISSN
0927-5940
ISSN-Digital
1573-6970
Type
journal article
Date Issued
2010-10-07
Abstract
This paper investigates the labor market impact of four often proposed
policy measures for sustainable pensions: strengthening the tax benefit link, moving from wage to price indexation of benefits, lengthening calculation periods, and introducing more actuarial fairness in pension assessment. We consider the impact on three margins of aggregate labor supply, retirement behavior, job search, and hours worked.We provide some analytical results and use a computational model to demonstrate the economic impact of recent pension reform in Austria. Reducing the distortion in the retirement decision by introducing pension supplements and discounts conditional on the chosen retirement date promises the largest gains.We also find that the pension reform is far from sufficient to offset the fiscal implications of projected demographic change in Austria.
policy measures for sustainable pensions: strengthening the tax benefit link, moving from wage to price indexation of benefits, lengthening calculation periods, and introducing more actuarial fairness in pension assessment. We consider the impact on three margins of aggregate labor supply, retirement behavior, job search, and hours worked.We provide some analytical results and use a computational model to demonstrate the economic impact of recent pension reform in Austria. Reducing the distortion in the retirement decision by introducing pension supplements and discounts conditional on the chosen retirement date promises the largest gains.We also find that the pension reform is far from sufficient to offset the fiscal implications of projected demographic change in Austria.
Language
English
Keywords
Pension reform
retirement
job search
life-cycle unemployment
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Springer
Publisher place
US
Volume
17
Number
5
Start page
556
End page
585
Pages
30
Subject(s)
Eprints ID
41698