Why forcing people to save for retirement may backfire

Arbeitspapier

If individuals are unable or unwilling to borrow, a higher than desired second pillar pension capital may induce people to retire earlier than they would have in the absence of such a scheme. Individuals thus leave the workforce as soon as the retirement income is deemed sufficient and the pension plan avails withdrawal of benefits. We provide evidence using individual data from a selection of Swiss pension funds, allowing us to perfectly control for pension scheme details. Our findings suggest that affordability is a key determinant in the retirement decisions. The higher the accumulated pension capital, the earlier individuals tend to leave the workforce.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 1458

Classification and Topics

• Classification: Wirtschaft ; Fiscal Policies and Behavior of Economic Agents: Household ; Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡ ; Retirement; Retirement Policies
• Subject: occupational pension ; retirement decision ; duration models ; Altersgrenze ; Alterssicherung ; Sparen ; Pensionsfonds ; Arbeitsangebot ; Schätzung ; Schweiz

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Buetler, Monika ; Huguenin, Olivia ; Teppa, Federica
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2005

Further information

• Handle: http://hdl.handle.net/10419/18822
• Last update: 10.03.2025, 11:43 AM CET