Template-Type: ReDIF-Paper 1.0

Author-Name: Barbara Hanel
Author-X-Name-First: Barbara
Author-X-Name-Last: Hanel


Title: Disability Pensions and Labor Supply
   
	
Abstract: I investigate the incentive effects of disability pensions  on the labor supply decision of the elderly in Germany. In the year 2001, a reform decreased the level of benefits and tightened the criteria of eligibility. The purpose of this paper is twofold: First, I estimate transition rates into disability retirement, both prior to and after the reform in order to evaluate the effect of the reform on retirement behavior. Second, I use the exogenous variation in  (a)  expected benefit levels and  (b) expected benefit accruals  that is caused by the reform,  in order to obtain reliable estimates of individuals’ responses in retirement behavior to financial incentives. While health status and expected wages  turn out  to be important determinants of the decision to enter disability retirement, benefits have only a small effect.  
 
Length:  37 pages
Creation-Date:  2010-01
File-URL: http://www.bgpe.de/texte/DP/086_hanel.pdf
File-Format: Application/pdf
File-Function: First version, 2010
Number: 086
Classification-JEL: I10, J26
Keywords: disability pensions, labor force exit, Germany
Handle: RePEc:bav:wpaper:086_hanel