Work Capacity at Older Ages in the Netherlands

37 Pages Posted: 8 Feb 2016 Last revised: 19 Jul 2021

See all articles by Adriaan Kalwij

Adriaan Kalwij

Utrecht University

Arie Kapteyn

Dornsife Center for Economic and Social Research - University of Southern California; IZA Institute of Labor Economics

Klaas de Vos

CentERdata; Tilburg University - Center for Economic Research (CentER)

Date Written: February 2016

Abstract

Over the last two decades policy reforms in the Netherlands have increased work incentives, resulting in rising employment rates at older ages. Over the same period health of the population has increased as well. A natural question is how much people could work taking into account their health status. As the other chapters in this volume, we use two approaches to answering this question. The first approach takes the relation between mortality and employment in 1981 as a base and then estimates what employment rates could be in 2010 if the relation between mortality and employment were the same in 1981 and 2010. The estimated additional work capacity based on this approach is about 50 percentage points for males at age 65. A second approach estimates the relation between health and employment in the age interval 50-54 and then predicts employment at later ages using health at these later ages. This leads to an estimated additional work capacity in 2010 of more than 75 percentage points for males aged 65-74. When including mortality as an additional health indicator to control for unobserved health differences in the latter approach, the estimated work capacities are more in line with those from the former approach: about 53 percentage points for males aged 65-69 and 44 percentage points for males aged 70-74.

Suggested Citation

Kalwij, Adriaan and Kapteyn, Arie and de Vos, Klaas, Work Capacity at Older Ages in the Netherlands (February 2016). NBER Working Paper No. w21976, Available at SSRN: https://ssrn.com/abstract=2729096

Adriaan Kalwij (Contact Author)

Utrecht University ( email )

Janskerkhof 12
Utrecht, 3512 BL
Netherlands

Arie Kapteyn

Dornsife Center for Economic and Social Research - University of Southern California ( email )

635 Downey Way
Los Angeles, CA 90089-3332
United States
310-448-5383 (Phone)

IZA Institute of Labor Economics

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

Klaas De Vos

CentERdata ( email )

PO Box 90153
Tilburg, NL 5000 LE
Netherlands

Tilburg University - Center for Economic Research (CentER) ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

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