Retire Later or Work Harder?

Citation

Bell D & Hart RA (2010) Retire Later or Work Harder?. Stirling Economics Discussion Paper, 2010-03.

Abstract
We compare two policies of increasing British state pension provision: (a) increase the pensionable age of men and women, (b) maintain the existing retirement age but require older workers to work longer per-period hours. There are reasons for policy makers to give serious consideration to the under-researched alternative (b). First, from wage - hours contract theory we know that there are potential gains to both workers and firms of allowing hours to rise in work experience. Second, there is strong evidence that job satisfaction rises in age. Third, there has in any case been a significant overall increase in the hours supplied by older workers in the last two decades. We review the relevant theory, model the trade-off between later retirement versus increased work intensity, produce relevant background facts, and provide estimates of the policy trade-offs.

Keywords
Older workers; statutory retirement age; hours of work; Old age pensions Government policy Great Britain; Retirement age Government policy Great Britain

JEL codes

• H55: Social Security and Public Pensions
• J11: Demographic Trends, Macroeconomic Effects, and Forecasts
• J14: Economics of the Elderly; Economics of the Handicapped; Non-labor Market Discrimination
• J18: Demographic Economics: Public Policy
• J22: Time Allocation and Labor Supply
• J26: Retirement; Retirement Policies