Early retirement and social security : a long term perspective

Arbeitspapier

We provide a long-term perspective on the individual retirement behaviour and on the future of retirement. In a Markovian political economic theoretical framework, in which incentives to retire early are embedded, we derive a political equilibrium with positive social security contribution rates and early retirement. Aging has two opposite effects: it leads to lower taxes and fewer (early) retirees, while a poorer median voter will push for higher contributions. The model highlights the existence of crucial income effects: a decrease of the income of young people will induce them to postpone retirement and to vote for less social security.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 1571

Classification and Topics

• Classification: Wirtschaft ; Social Security and Public Pensions ; Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior ; National Government Expenditures and Welfare Programs
• Subject: pensions ; income effect ; tax burden ; politico-economic Markovian equilibrium ; Flexible Altersgrenze ; Soziale Sicherung ; Sozialversicherungsbeitrag ; Public Choice ; Einkommenseffekt ; Alternde Bevölkerung ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Conde-Ruiz, Jose Ignacio ; Galasso, Vincenzo ; Profeta, Paola
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2005

Further information

• Handle: http://hdl.handle.net/10419/19035
• Last update: 10.03.2025, 11:44 AM CET