Pension Rules and Labour Market Mobility

36 Pages Posted: 10 Jul 2017

See all articles by Marloes Lammers

Marloes Lammers

VU University Amsterdam; Tinbergen Institute; Netspar

Hans Bloemen

VU University Amsterdam; IZA Institute of Labor Economics; Tinbergen Institute; Netspar

Stefan Hochguertel

VU University Amsterdam; Tinbergen Institute

Abstract

This paper makes use of a natural experiment to examine effects of potential capital losses and general attractiveness of pension schemes on employees' propensity to change jobs. On January 1st 2004, the two largest pension funds in the Netherlands, for civil servants and for the health care sector, changed their pension scheme from a final salary to an average salary. This industry-level change excludes the possibility that a negative correlation between having a job with an attractive pension scheme and the number of labour market transitions is driven by self-selection of workers into jobs with an attractive pension arrangement. Using individual data covering the entire Dutch population, we estimate discrete choice models for job-to-job transitions. The results show that the number of job transitions of civil servants significantly increased at the onset of the new pension rules. The changing pension rules affected the propensity to change jobs for individuals working in the health care sector only to a smaller extent.

Keywords: discrete choice models, policy evaluation, labour market flexibility, pension systems

JEL Classification: C35, J26, J32, J63

Suggested Citation

Lammers, Marloes and Bloemen, Hans and Hochguertel, Stefan, Pension Rules and Labour Market Mobility. IZA Discussion Paper No. 10840, Available at SSRN: https://ssrn.com/abstract=2998949

Marloes Lammers (Contact Author)

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, ND North Holland 1081 HV
Netherlands

Tinbergen Institute

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

Netspar

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Hans Bloemen

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, ND North Holland 1081 HV
Netherlands

IZA Institute of Labor Economics

Schaumburg-Lippe-Str. 7 / 9
Bonn, D-53072
Germany

Tinbergen Institute

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

Netspar

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Stefan Hochguertel

VU University Amsterdam ( email )

Dept Econ (FEWEB)
De Boelelaan 1105
1081HV Amsterdam
Netherlands
+31 20 59 86033 (Phone)
+31 20 59 89870 (Fax)

Tinbergen Institute

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

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