Nonparametric Evidence on the Effects of Financial Incentives on Retirement Decisions

51 Pages Posted: 20 Feb 2014

See all articles by Day Manoli

Day Manoli

University of Texas at Austin

Andrea Weber

Vienna University of Economics and Business; Austrian Institute of Economic Research (WIFO); Institute for the Study of Labor (IZA); CESifo (Center for Economic Studies and Ifo Institute)

Date Written: January 31, 2014

Abstract

This paper presents new evidence on the effects of retirement benefits on labor force participation decisions. The analysis is based on a mandated rule for employer-provided retirement benefits in Austria that creates discontinuities in the incentives for workers to delay retirement. We present graphical evidence on labor supply responses and effective financial incentives and develop nonparametric methods to estimate extensive margin labor supply elasticities. Overall, multiple results highlight modest impacts of financial incentives on retirement decisions.

JEL Classification: H310, J140, J260

Suggested Citation

Manoli, Day and Weber, Andrea Michaela, Nonparametric Evidence on the Effects of Financial Incentives on Retirement Decisions (January 31, 2014). CESifo Working Paper Series No. 4619. Available at SSRN: https://ssrn.com/abstract=2398310

Day Manoli

University of Texas at Austin ( email )

2317 Speedway
Austin, TX 78712
United States

Andrea Michaela Weber (Contact Author)

Vienna University of Economics and Business ( email )

Welthandelsplatz 1
Vienna, 1020
Austria

Austrian Institute of Economic Research (WIFO) ( email )

P.O. Box 91
Wien, A-1103
Austria

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

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