'Earned, not given'? The effect of lowering the full retirement age on retirement decisions

• 成果类型: Article
• 署名作者: Dolls, Mathias; Krolage, Carla
• 署名单位: Leibniz Association; Ifo Institut; Leibniz Association; Ifo Institut; University of Regensburg
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2023.104909
• 发表日期: 2023
• 关键词: retirement age; Early retirement; pension reform

摘要

This paper analyzes behavioral responses to a 2014 reform in the German public pension system that lowered the full retirement age (FRA) of individuals with a long contribution history by up to two years and framed the new FRA as reference age for retirement. Using administrative data from public pension insurance accounts, we first document a substantial bunching response at the FRA exceeding the control group's bunching by 83%. Second, we show in a difference-in-difference setting that a 1.0 year decrease in the FRA leads to a reduction in the average pension claiming age by 0.3-0.4 years. Treated individuals neither have poorer health nor are more likely to be liquidity-constrained than individuals in the control group. Our results suggest that the strong responses to the reform are driven both by the new FRA serving as a reference point and by financial incentives. Estimated fiscal costs of the reform are at the upper end of the range of previous back-of-the-envelope calculations.& COPY; 2023 Elsevier B.V. All rights reserved.