The Effect of Incentive-Induced Retirement on Spousal Retirement Rates: Evidence From a Natural Experiment

Research output: Contribution to JournalArticleAcademicpeer-review

Abstract

We identify, quantify, and explain the impact of incentive-induced early retirement (ER) of husbands on their wives' probability to retire within 1 year, using administrative data from the Netherlands. Our identification strategy is based on a policy intervention by which targeted individuals working at the central government level became unexpectedly and temporarily eligible for very generous ER benefits. This retirement window of opportunity implied for interested workers that transitions from the current job into full retirement had to be effected swiftly and irreversibly. We find that induced ER of husbands increased their wives' probability to retire by 10 percentage points. This is a strong and robust local average treatment effect. Partly, the effect runs through wives at ages when they may have been eligible for ER programs themselves. (JEL C26, J26, J120, J140).

LanguageEnglish
Pages910-930
Number of pages21
JournalEconomic Inquiry
Volume57
Issue number2
Early online date8 Dec 2018
DOIs
Publication statusPublished - Apr 2019

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Incentives
Natural experiment
Retirement
Early retirement
Central government
Administrative data
The Netherlands
Workers
Average treatment effect
Policy intervention

Cite this

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abstract = "We identify, quantify, and explain the impact of incentive-induced early retirement (ER) of husbands on their wives' probability to retire within 1 year, using administrative data from the Netherlands. Our identification strategy is based on a policy intervention by which targeted individuals working at the central government level became unexpectedly and temporarily eligible for very generous ER benefits. This retirement window of opportunity implied for interested workers that transitions from the current job into full retirement had to be effected swiftly and irreversibly. We find that induced ER of husbands increased their wives' probability to retire by 10 percentage points. This is a strong and robust local average treatment effect. Partly, the effect runs through wives at ages when they may have been eligible for ER programs themselves. (JEL C26, J26, J120, J140).",
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The Effect of Incentive-Induced Retirement on Spousal Retirement Rates : Evidence From a Natural Experiment. / Bloemen, Hans; Hochguertel, Stefan; Zweerink, Jochem.

In: Economic Inquiry, Vol. 57, No. 2, 04.2019, p. 910-930.

Research output: Contribution to JournalArticleAcademicpeer-review

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