Scandinavian Working Papers in Economics

Working Paper Series, Center for Fiscal Studies,
Uppsala University, Department of Economics

No 2011:8: What happens to the husband’s retirement decision when the wife’s retirement incentives change?

Håkan Selin ()
Additional contact information
Håkan Selin: Uppsala Center for Fiscal Studies, Postal: Department of Economics, Uppsala University, P.O. Box 513, SE-751 20 Uppsala, Sweden

Abstract: Several studies have documented a strong correlation in the timing of spouses’ retirement decisions. However, considerably less is known about the causal impact of one spouse’s retirement incentives on the retirement decision of the other spouse. Before, but not after, 2001 broad categories of Swedish local government workers in female dominated occupations were entitled to retire with full pension benefits already at the age of 63. In this paper, we utilize this reform – together with a micro data set covering the total Swedish population – to estimate the effect of a change in the wife’s incentive on the husband’s retirement behavior. We document a sharp decrease in pension benefit withdrawals among 63 year old wives in the local government sector in the years following the reform. However, we do not find any evidence of a response among husbands. This finding is at odds with some earlier results in the literature.

Keywords: Joint retirement; retirement age; occupational pensions

JEL-codes: H55; J13; J21

37 pages, July 11, 2011

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