Scandinavian Working Papers in Economics
HomeAboutSeriesSubject/JEL codesAdvanced Search
Department of Business and Economics, University of Southern Denmark Discussion Papers of Business and Economics
Department of Business and Economics, University of Southern Denmark

No 5/2009:
The optimal legal retirement age in an OLG model with endogenous labour supply

Casper Worm Hansen () and Lars Lønstrup ()

Abstract: The long run welfare implications of the legal retirement age are studied in a perfect foresight overlapping-generations model where agents live for two periods. Agents’ lifetime is divided between working life and retirement by a legal retirement age controlled by the government whereas agents, besides savings, control the intensive margin or "yearly" labour supply. The legal retirement age is utilized to dampen distortionary effects of payroll taxes and public pension annuities and promote capital accumulation. We show that a social optimal legal retirement age exists and how it depends on whether payroll taxes or benefit annuities ensures budget balance of the PAYG pension system.

Keywords: Optimal legal retirement age; pay-as-you-go-pension systems; overlapping-generations model; (follow links to similar papers)

JEL-Codes: E61; H55; J26; (follow links to similar papers)

26 pages, July 1, 2009

Before downloading any of the electronic versions below you should read our statement on copyright.
Download GhostScript for viewing Postscript files and the Acrobat Reader for viewing and printing pdf files.

Full text versions of the paper:

dpbe5_2009.pdf    PDF-file
Download Statistics

Questions (including download problems) about the papers in this series should be directed to Lene Holbæk ()
Report other problems with accessing this service to Sune Karlsson () or Helena Lundin ().

Programing by
Design by Joachim Ekebom

Handle: RePEc:hhs:sdueko:2009_005 This page was generated on 2014-12-14 19:26:41