The Determinants of Occupational Pensions

30 Pages Posted: 27 Nov 2007

See all articles by Erik Hernæs

Erik Hernæs

University of Oslo - Ragnar Frisch Centre for Economic Research

John Piggott

University of New South Wales (UNSW) - Australian School of Business, School of Economics

Tao Zhang

Ragnar Frisch Centre for Economic Research

Steinar Strøm

University of Oslo - Ragnar Frisch Centre for Economic Research; CESifo (Center for Economic Studies and Ifo Institute)

Date Written: January 5, 2006

Abstract

The decision by firms to offer an occupational pension is investigated with a unique linked employer/employee dataset, supplemented with detailed actuarial calculations of the cost to the firms of offering occupational pensions and constructed tax gains from pension contributions versus cash wage, driven by lower tax on wages than on pensions. The tax gains which can be shared between employers and employees by the degree of wage moderation, are clearly associated with the occurrence of an occupational pension plan. An occupational pension is associated with longer average tenure in the firm. Occupational pensions typically are found in large firms, and individual wage negotiations, a high degree of unionization and requirement of long training are all positively associated with an occupational pension. Hence, financial and productivity incentives are found to operate within a moderating institutional framework.

Keywords: occupational pensions, tax gains, tenure, linked employer/employee datasets

JEL Classification: C25, D21, G23

Suggested Citation

Hernæs, Erik and Piggott, John and Zhang, Tao and Strøm, Steinar, The Determinants of Occupational Pensions (January 5, 2006). Available at SSRN: https://ssrn.com/abstract=1032786 or http://dx.doi.org/10.2139/ssrn.1032786

Erik Hernæs

University of Oslo - Ragnar Frisch Centre for Economic Research ( email )

Gaustadalleen 21
N-0317 Oslo
Norway

John Piggott (Contact Author)

University of New South Wales (UNSW) - Australian School of Business, School of Economics ( email )

High Street
Sydney, NSW 2052
Australia

Tao Zhang

Ragnar Frisch Centre for Economic Research ( email )

Gaustadalleen 21
N-0349 Oslo
Norway
+47-22958816 (Phone)
+47-22958825 (Fax)

Steinar Strøm

University of Oslo - Ragnar Frisch Centre for Economic Research ( email )

Gaustadalleen 21
N-0317 Oslo
Norway

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Register to save articles to
your library

Register

Paper statistics

Downloads
84
Abstract Views
724
rank
303,115
PlumX Metrics