Too Old to Work, Too Young to Retire

Ichino, Andrea and Schwerdt, Guido and Winter-Ebmer, Rudolf and Zweimüller, Josef (October 2007) Too Old to Work, Too Young to Retire. IHS Economics Series 220

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Abstract or Table of Contents

Abstract: We use firm closure data for Austria 1978-1998 to investigate the effect of age on employment prospects. We rely on exact matching to compare workers displaced by firm closure with similar non-displaced workers. We then use a difference-in-difference strategy to analyze employment and earnings of older relative to prime-age workers in the displacement and non-displacement groups. Results suggest that immediately after plant closure the old have lower re-employment probabilities as compared to prime-age workers but later they catch up. While among the young the employment prospects of the displaced remain persistently different from those of the non-displaced, among the old the effect of displacement fades away, and actually disappears even immediately after plant closure when the effect of tenure based severance payment is controlled for. Our evidence suggests that increasing the retirement age does not necessarily produce individuals who are "too old to work but too young to retire".;

Item Type: IHS Series
Keywords: 'Aging' 'Employability' 'Plant Closures' 'Matching'
Classification Codes (e.g. JEL): J14, J65
Status: Published
Date Deposited: 26 Sep 2014 10:38
Last Modified: 25 Jul 2017 18:18
URI: http://irihs.ihs.ac.at/id/eprint/1804

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