By browsing this website, you acknowledge the use of a simple identification cookie. It is not used for anything other than keeping track of your session from page to page. OK
1

Seniority wages and the role of firms in retirement

Bookmarks
Book

Frimmel, Wolfgang ; Horvath, Thomas ; Schnalzenberger, Mario ; Winter-Ebmer, Rudolf

Institute of Labor Economics, Bonn

IZA - Bonn

2015

30 p.

older worker ; retirement ; seniority ; wage incentive

Austria

Discussion Paper

9192

Social protection - Old age benefits

http://www.iza.org/

English

Bibliogr.

"In general, retirement is seen as a pure labor supply phenomenon, but firms can have strong incentives to send expensive older workers into retirement. Based on the seniority wage model developed by Lazear (1979), we discuss steep seniority wage profiles as incentives for firms to dismiss older workers before retirement. Conditional on individual retirement incentives, e.g., social security wealth or health status, the steepness of the wage profile will have different incentives for workers as compared to firms when it comes to the retirement date. Using an instrumental variable approach to account for selection of workers in our firms and for reverse causality, we find that firms with higher labor costs for older workers are associated with lower job exit age."

Digital



Bookmarks