Retirement with Perfect Insurance

Arbeitspapier

This paper focuses on the relation between worker's productivity and retirement decision. Assuming that productivity follows geometric Brownian motion with drift, there exists such a level of productivity for which it is optimal to retire. The worker buys an insurance, which gives a constant income and retirement benefits in exchange for the total output. The level of income and benefits is set to maximize lifetime utility. In such framework we find the retirement threshold of productivity and the probability of retirement.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Tinbergen Institute Discussion Paper ; No. 03-097/3

Classification and Topics

• Classification: Wirtschaft ; Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity ; Insurance; Insurance Companies; Actuarial Studies ; Retirement; Retirement Policies
• Subject: retirement ; insurance ; productivity ; Altersgrenze ; Arbeitsproduktivität ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Kula, Grzegorz
• Event: Veröffentlichung
• (who): Tinbergen Institute
• (where): Amsterdam and Rotterdam
• (when): 2003

Further information

• Handle: http://hdl.handle.net/10419/85996
• Last update: 10.03.2025, 11:43 AM CET