Pension incentives and labor supply: Evidence from the introduction of universal old-age assistance in the UK

Arbeitspapier

We study the labor supply effects and welfare implications of introducing a universal means-tested old-age assistance program in times of very limited social protection. We take advantage of a unique historical reform: The Old-Age Pension Act (OPA) of 1908, which, for the first time, provided pensions to older people in the UK. Using recently released full-count census data covering the entire population, we exploit variation at the newly created age-based eligibility threshold. Our results show a considerable and abrupt decline in labor force participation of 6.0 percentage points (13%) when older workers reach the eligibility age of 70. This sudden drop only occurs at the age cutoff and only after the OPA was implemented. Despite the considerable labor supply decline, the overall efficiency loss from the OPA was limited and most likely outweighed by equity gains.

Angaben zum Objekt

• ISBN: 978-3-86788-979-7
• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: Ruhr Economic Papers ; No. 844

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Allocative Efficiency; Cost-Benefit Analysis ; Taxation and Subsidies: Efficiency; Optimal Taxation ; Social Security and Public Pensions ; Economics of the Elderly; Economics of the Handicapped; Non-labor Market Discrimination ; Time Allocation and Labor Supply ; Retirement; Retirement Policies
• Thema: Old-age assistance ; labor supply ; retirement ; regression discontinuity design ; equity-efficiency trade-off

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Giesecke, Matthias ; Jäger, Philipp
• Ereignis: Veröffentlichung
• (wer): RWI - Leibniz-Institut für Wirtschaftsforschung
• (wo): Essen
• (wann): 2020

Weitere Informationen

• DOI: doi:10.4419/86788979
• Handle: http://hdl.handle.net/10419/216748
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ