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Public Pension Programmes and the Retirement of Married Couples in Denmark

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  • Paul Bingley

    (Economics Department, Aarhus School of Business)

  • Gauthier Lanot

    (Keele University, Centre for Economic Research and School of Economic and Management Studies)

Abstract

In this paper we study the economic determinants of the joint retirement process of married couples. We propose a tractable dynamic discrete choice model for retirement decisions which allows for non-trivial saving behaviour. We estimate the model on a 1\% sample of Danish couples of potential retirement age drawn from a population-based administrative register. The introduction and subsequent reforms of a publicly financed early-retirement programme provide us with variation in the data to ensure identification of the the elasticities of participation/retirement with respect to income flows. Our estimates imply a significant asymmetry in the sensitivity of retirement behaviour of men and women with respect to variation in their own, or their spouse’s income flows.

Suggested Citation

  • Paul Bingley & Gauthier Lanot, 2006. "Public Pension Programmes and the Retirement of Married Couples in Denmark," Keele Economics Research Papers KERP 2006/20, Centre for Economic Research, Keele University.
    • Handle: RePEc:kee:kerpuk:2006/20
    Note: The Danish Social Sciences Research Council (24-02-0064) and UK Economic and Social Research Council (RES-000-27-0200) provided funding. This paper has benefited from comments received from workshop participants in CAM Copenhagen, RES Nottingham and TAPES Uppsala, especially Martin Browning, Jim Poterba, Arthur Van Soest and Ian Walker. The usual disclaimer applies.
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    References listed on IDEAS

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    Cited by:

    1. Merkurieva, Irina, 2023. "Retirement coordination and leisure complementarity," Labour Economics, Elsevier, vol. 85(C).
    2. Berangere Legendre & Annaig-C. Pedrant & Mareva Sabatier, 2018. "Should I stay or should I go? An econometric analysis of retirement decisions by couples," Applied Economics, Taylor & Francis Journals, vol. 50(53), pages 5814-5829, November.
    3. Christelle Garrouste & Omar Paccagnella, 2011. "Shall I stay or shall I go? Late graduation and retirement decision," Post-Print hal-03245583, HAL.
    4. Gørtz, Mette & Sander, Sarah & Sevilla, Almudena, 2023. "Does the Child Penalty Strike Twice, and If So Why?," IZA Discussion Papers 16557, Institute of Labor Economics (IZA).
    5. Kristensen, Nicolai, 2012. "Training and Retirement," IZA Discussion Papers 6301, Institute of Labor Economics (IZA).
    6. Andries de Grip & Didier Fouarge & Raymond Montizaan, 2013. "How Sensitive are Individual Retirement Expectations to Raising the Retirement Age?," De Economist, Springer, vol. 161(3), pages 225-251, September.
    7. Raab, Roman, 2017. "Retirement and Informal Care-giving: Behavioral Patterns among Older Workers," Working Papers 2017-08, Joint Research Centre, European Commission.
    8. García-Miralles, Esteban & Leganza, Jonathan M., 2024. "Joint retirement of couples: Evidence from discontinuities in Denmark," Journal of Public Economics, Elsevier, vol. 230(C).
    9. Sarah Le Duigou & Pierre-Jean Messe, 2017. "Pension reforms, older workers' employment and the role of job separation and finding rates in France," TEPP Working Paper 2017-10, TEPP.
    10. Francesca Carta & Marta De Philippis, 2021. "Working horizon and labour supply: the effect of raising the full retirement age on middle-aged individuals," Temi di discussione (Economic working papers) 1314, Bank of Italy, Economic Research and International Relations Area.
    11. Simon Georges-Kot & Dominique Goux & Eric Maurin, 2024. "The Value of Leisure Synchronization," American Economic Journal: Applied Economics, American Economic Association, vol. 16(1), pages 351-376, January.
    12. Niels Vermeer, 2016. "Age Anchors and the Expected Retirement Age: An Experimental Study," De Economist, Springer, vol. 164(3), pages 255-279, September.
    13. Hanne Preter & Dorien Looy & Dimitri Mortelmans, 2015. "Retirement Timing of Dual-Earner Couples in 11 European Countries? A Comparison of Cox and Shared Frailty Models," Journal of Family and Economic Issues, Springer, vol. 36(3), pages 396-407, September.
    14. Ventura-Marco, Manuel & Vidal-Meliá, Carlos & Pérez-Salamero González, Juan Manuel, 2023. "Joint life care annuities to help retired couples to finance the cost of long-term care," Insurance: Mathematics and Economics, Elsevier, vol. 113(C), pages 122-139.
    15. John Rodwell & Thomas Hendry & Dianne Johnson, 2022. "A Parsimonious Taxonomy of The Newly Retired: Spousal and Disability Combinations Shape Part or Complete Retirement," IJERPH, MDPI, vol. 19(20), pages 1-13, October.

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    More about this item

    Keywords

    Retirement; pensions; dynamic structural model.;
    All these keywords.

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions

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