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Raising the Mandatory Retirement Age and its Effect on Long-run Income and Pay-as-you-go (PAYG) Pensions

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  • Luciano Fanti

Abstract

In this paper we study the effects of raising the mandatory retirement age in the neoclassical growth model context. It is shown that postponement of the retirement age may be harmful for long-run income and even for pensions. Our findings show that the retirement age might be reduced, thereby obtaining a higher income and even higher pension benefits. This suggests that the idea that a higher mandatory age of retirement is always beneficial in the long run for income and pension payments is theoretically controversial.

Suggested Citation

  • Luciano Fanti, 2014. "Raising the Mandatory Retirement Age and its Effect on Long-run Income and Pay-as-you-go (PAYG) Pensions," Metroeconomica, Wiley Blackwell, vol. 65(4), pages 619-645, November.
    • Handle: RePEc:bla:metroe:v:65:y:2014:i:4:p:619-645
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    Cited by:

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    2. Cipriani, Giam Pietro & Pascucci, Francesco, 2020. "Pension policies in a model with endogenous fertility," Journal of Pension Economics and Finance, Cambridge University Press, vol. 19(1), pages 109-125, January.
    3. Riccardo Magnani, 2016. "Is an Increase in the Minimum Retirement Age Always Desirable? The Case of Notional Defined Contribution Systems," Metroeconomica, Wiley Blackwell, vol. 67(3), pages 578-602, July.
    4. Edouard A. Ribes, 2022. "Financial planning and optimal retirement timing for physically intensive occupations," SN Business & Economics, Springer, vol. 2(8), pages 1-28, August.
    5. Jin Hu & Peter-Josef Stauvermann & Surya Nepal & Yuanhua Zhou, 2023. "Can the Policy of Increasing Retirement Age Raise Pension Revenue in China—A Case Study of Anhui Province," IJERPH, MDPI, vol. 20(2), pages 1-15, January.
    6. Zhen Hu & James Yang, 2021. "Does Delayed Retirement Crowd Out Workforce Welfare? Evidence in China," SAGE Open, , vol. 11(4), pages 21582440211, November.
    7. Peter J. Stauvermann & Jin Hu, 2018. "What can China Expect from an Increase of the Mandatory Retirement Age?," Annals of Economics and Finance, Society for AEF, vol. 19(1), pages 229-246, May.

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