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Spouses’ retirement and the take-up of disability pension

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Abstract

This paper studies the effect of one spouse’s retirement on the Retirement of the other using a Norwegian early reform, which reduced the retirement age for workers in selected firms. The findings indicate that after the reform, the spouses of those who could retire earlier were less likely to remain in the workforce compared to the spouses of those who were not included in the early retirement scheme. This finding is compatible with preferences for shared spousal leisure. Contrary to previous findings, wives respond to husbands’ early retirement decisions. However, the findings are less conclusive with respect to husbands’ response to wives’ early retirement decisions. An investigation of the responding wives’ labor market exit strategy reveals that the reform increased their likelihood of retiring with a disability pension, representing a cost to public finance incurred in addition to the general retirement costs. This study contributes to other recent evidence on the influence of of non-health-related factors on the use of disability benefits among older workers.

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  • Johnsen, Julian V. & Vaage, Kjell, 2015. "Spouses’ retirement and the take-up of disability pension," Working Papers in Economics 03/15, University of Bergen, Department of Economics.
    • Handle: RePEc:hhs:bergec:2015_003
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    Cited by:

    1. Laun, Tobias & Markussen, Simen & Vigtel, Trond Christian & Wallenius, Johanna, 2019. "Health, longevity and retirement reform," Journal of Economic Dynamics and Control, Elsevier, vol. 103(C), pages 123-157.

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    More about this item

    Keywords

    Joint retirement; disability pension; older workers;
    All these keywords.

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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