Who Pays for Occupational Pensions?

Abstract

The purpose of this paper is to estimate wage effects of occupational pensions, exploiting the introduction of mandatory occupational pensions in Norway as a source of exogenous variation in pension coverage. Various difference-in-differences models are estimated on a large sample of Norwegian private sector firms. The results indicate that on average, less than half the costs of a minimum requirement occupational pension was shifted from firms to workers in terms of lower wages, and that there are important heterogeneities with respect to the influence of local unions and central negotiations on the wage setting in different industries.

Keywords: pension reform, mandatory occupational pensions, labour unions and centralised negotiations, matched employer-employee register data

JEL Classification: H22, J32, J38, J50