Social security and retirement across OECD countries

Alonso Ortiz, Jorge (2009): Social security and retirement across OECD countries.

Abstract

There are large differences in the employment to population ratio relative to the US across OECD countries, and these differences are even larger for the old age (55-69 years). There are also large differences in various features of social security, such as the replacement rate, the entitlement age or whether it is allowed to collect social security while working. These observations suggest that they might be an important contributing factor in accounting for differences in retirement. I assess quantitatively the importance of these features using a life cycle general equilibrium model of retirement. I find that the differences in social security account for 90% of the differences in employment to population ratio at ages 60-64 in the OECD. The differences in the replacement rates and whether the system allows for collecting social security while working are the most important contributing factors to account for the differences in retirement.

• Item Type: MPRA Paper
• Language: English
• Keywords: Social security, retirement, idiosyncratic labor income risk
• Subjects: J - Labor and Demographic Economics > J1 - Demographic Economics > J14 - Economics of the Elderly ; Economics of the Handicapped ; Non-Labor Market Discrimination; E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy > E24 - Employment ; Unemployment ; Wages ; Intergenerational Income Distribution ; Aggregate Human Capital ; Aggregate Labor Productivity; H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H20 - General; J - Labor and Demographic Economics > J2 - Demand and Supply of Labor > J26 - Retirement ; Retirement Policies

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