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Early Retirement: The Impact of Changes in the Benefit Level

Author

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  • Jan H.M. Nelissen

    (Faculty of Economics, Erasmus University Rotterdam)

Abstract

In the Netherlands a transition takes place fromearly retirement schemes, which are characterizedby high implicit tax rates to schemes that have ahigher degree of actuarial fairness. in this paperwe look at the impact of this change at the laborparticipation rates of 55 to 65 years old persons.The analysis has been applied on repeated choiceson the basis of stated preferences. We estimate amixed (or random parameters) logit model. The mostimportant finding is the independent role that isplayed by the number of years for which has builtup pension claims. Its impact does not only run viathe discounted value of future pension streams. Theresults indicate that the change in the earlyretirement schemes will considerably increaselabor participation. A participation rate of 50%for the age group under consideration is within reach.

Suggested Citation

  • Jan H.M. Nelissen, 2002. "Early Retirement: The Impact of Changes in the Benefit Level," Tinbergen Institute Discussion Papers 02-031/3, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20020031
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    References listed on IDEAS

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    1. Jonathan Gruber & David A. Wise, 1999. "Introduction to "Social Security and Retirement around the World"," NBER Chapters, in: Social Security and Retirement around the World, pages 1-35, National Bureau of Economic Research, Inc.
    2. David Revelt & Kenneth Train, 1998. "Mixed Logit With Repeated Choices: Households' Choices Of Appliance Efficiency Level," The Review of Economics and Statistics, MIT Press, vol. 80(4), pages 647-657, November.
    3. Jonathan Gruber & David A. Wise, 1999. "Social Security and Retirement around the World," NBER Books, National Bureau of Economic Research, Inc, number grub99-1.
    4. Maarten Lindeboom, 1998. "Microeconometric Analysis of the Retirement Decision: The Netherlands," OECD Economics Department Working Papers 207, OECD Publishing.
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    Cited by:

    1. Jan-Maarten van Sonsbeek & j.m.van.sonsbeek@vu.nl, 2011. "Micro simulations on the effects of ageing-related policy measures: The Social Affairs Department of the Netherlands Ageing and Pensions Model," International Journal of Microsimulation, International Microsimulation Association, vol. 4(1), pages 72-99.

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    More about this item

    Keywords

    preretirement; labour participation; mixed logit; stated preferences;
    All these keywords.

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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