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What happens to the husband’s retirement decision when the wife’s retirement incentives change?

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  • Selin, Håkan

    (Uppsala Center for Fiscal Studies)

Abstract

Several studies have documented a strong correlation in the timing of spouses’ retirement decisions. However, considerably less is known about the causal impact of one spouse’s retirement incentives on the retirement decision of the other spouse. Before, but not after, 2001 broad categories of Swedish local government workers in female dominated occupations were entitled to retire with full pension benefits already at the age of 63. In this paper, we utilize this reform – together with a micro data set covering the total Swedish population – to estimate the effect of a change in the wife’s incentive on the husband’s retirement behavior. We document a sharp decrease in pension benefit withdrawals among 63 year old wives in the local government sector in the years following the reform. However, we do not find any evidence of a response among husbands. This finding is at odds with some earlier results in the literature.

Suggested Citation

  • Selin, Håkan, 2011. "What happens to the husband’s retirement decision when the wife’s retirement incentives change?," Working Paper Series, Center for Fiscal Studies 2011:8, Uppsala University, Department of Economics.
    • Handle: RePEc:hhs:uufswp:2011_008
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    Cited by:

    1. García-Miralles, Esteban & Leganza, Jonathan M., 2024. "Joint retirement of couples: Evidence from discontinuities in Denmark," Journal of Public Economics, Elsevier, vol. 230(C).
    2. Lisa Laun & Mårten Palme, 2018. "The Recent Rise of Labor Force Participation of Older Workers in Sweden," NBER Chapters, in: Social Security Programs and Retirement around the World: Working Longer, pages 231-265, National Bureau of Economic Research, Inc.
    3. Todd Morris, 2022. "The unequal burden of retirement reform: Evidence from Australia," Economic Inquiry, Western Economic Association International, vol. 60(2), pages 592-619, April.
    4. Lisa Laun & Mårten Palme, 2023. "Pension Reform, Incentives to Retire and Retirement Behavior: Empirical Evidence from Swedish Microdata," NBER Chapters, in: Social Security Programs and Retirement around the World: The Effects of Reforms on Retirement Behavior, National Bureau of Economic Research, Inc.
    5. Todd Morris & Benoit Dostie, 2023. "Graying and staying on the job: The welfare implications of employment protection for older workers," Cahiers de recherche / Working Papers 15, Institut sur la retraite et l'épargne / Retirement and Savings Institute.
    6. Moghadam, Hamed Markazi & Puhani, Patrick & Tyrowicz, Joanna, 2023. "Pension Reforms and Couples' Labour Supply Decisions," Economics Working Paper Series 2304, University of St. Gallen, School of Economics and Political Science.
    7. Atalay, Kadir & Barrett, Garry F., 2016. "Pension Incentives and the Retirement Decisions of Couples," IZA Discussion Papers 10013, Institute of Labor Economics (IZA).
    8. Geyer, Johannes & Haan, Peter & Hammerschmid, Anna & Peters, Michael, 2020. "Labor Market and Distributional Effects of an Increase in the Retirement Age," Labour Economics, Elsevier, vol. 65(C).
    9. Herman Kruse, 2021. "Joint Retirement in Couples: Evidence of Complementarity in Leisure," Scandinavian Journal of Economics, Wiley Blackwell, vol. 123(3), pages 995-1024, July.
    10. Julian Vedeler Johnsen & Kjell Vaage & Alexander Willén, 2022. "Interactions in Public Policies: Spousal Responses and Program Spillovers of Welfare Reforms," The Economic Journal, Royal Economic Society, vol. 132(642), pages 834-864.
    11. Selin, Håkan, 2011. "What happens to the husband’s retirement decision when the wife’s retirement incentives change?," Working Paper Series, Center for Fiscal Studies 2011:8, Uppsala University, Department of Economics.
    12. Kadir Atalay & Garry F. Barrett & Peter Siminski, 2019. "Pension incentives and the joint retirement of couples: evidence from two natural experiments," Journal of Population Economics, Springer;European Society for Population Economics, vol. 32(3), pages 735-767, July.
    13. Johannes Hagen, 2018. "The effects of increasing the normal retirement age on health care utilization and mortality," Journal of Population Economics, Springer;European Society for Population Economics, vol. 31(1), pages 193-234, January.
    14. 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.
    15. Hagen, Johannes, 2016. "What are the Health effects of postponing retirement? An instrumental variable approach," Working Paper Series 2016:11, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    16. Håkan Selin, 2017. "What happens to the husband’s retirement decision when the wife’s retirement incentives change?," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 24(3), pages 432-458, June.

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    More about this item

    Keywords

    Joint retirement; retirement age; occupational pensions;
    All these keywords.

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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