We investigate induced retirement effects of the Norwegian early retirement program "AFP" and emphasizes effects caused by relocations of some individuals from disability pension and unemploy,emt to AFP. Our theoretical model predicts that AFP unembiguously induces more early retirement.

Following the seminal work of Samuelson (1975), a theoretical literature has grown examining the macroeconomic relationship between social security, aggregate saving and the allocation of resources within an overlapping generations economy. One such paper by Hu (1979) suggests inter alia that a...

This paper explains why workers retire earlier, and earlier at the same time as society becomes more and more indebted through increasing pay-as-you-go pension liabilities. To do so, we extend the standard two-overlapping-generations growth model to allow for endogenous labor participation in...

The European population is living longer but retiring earlier. More and more individuals are spending an increasing fraction of their lifetime relying on retirement benefits. At the same time, social security programs face mounting financial difficulties. The purpose of this paper is to explain...

The authors consider a simple static model with a population divided into workers and retirees. Taxes on wages finance pensions to retirees and other benefits. A minimum net wage constraint can induce unemplyment. They assume that the tax rate fits in order to equilibrate contributions and...

The aim of this paper is to provide a political-economic explanation of the wide spread adoption of generous early retirement. We suggest that the political support for generous early retirement provisions relies on: (i) the existence of an initial, significant group of redundant elderly workers...

The increasing number of disability pensioners may put a strain on the welfare state. In this paper, we try to assess the effect of financial incentives on disability entrance. A sample of Norwegians on long-term sick leave at the beginning of 1989 is examined as of the end of 1989 and the exit...

Why are the old politically successful? We build a simple interest group model in which political pressure is time-intensive, showing that in the political competitive equilibrium each group lobbies for gvernment policies that lower their own value of time but that the old do so to a greater...

We investigate induced retirement effects of the Norwegian early retirement program "AFP" and emphasize effects caused by relocations of some individuals from disability pension and unemployment to AFP. Our theoretical model predicts that AFP unambiguously induces more early retirement.

In order to stimulate labor market participation and improve the financial viability of the social security systems, many recent reform proposals in various OECD economies suggest to scale down the non-actuarial parts of the pension systems. These reforms have a flavour of increased efficiency...