December 2007
The labor market effects of pension reform stem from retirement behavior and from job search and hours worked of prime age workers. This paper investigates the impact of four often proposed policy measures for sustainable pensions: strengthening the tax benefit link, moving from wage to price indexation of benefits, lengthening calculation periods, and introducing more actuarial fairness in pension assessment. We provide some analytical results and use a computational model to demonstrate the economic and welfare impact of recent pension reform in Austria.
Also published in: forthcoming: International Tax and Public Finance
Keywords: pension reform, retirement, job search, life-cycle unemployment
JEL Classification: [D580] Computable and Other Applied General Equilibrium Models [D910] Intertemporal Consumer Choice; Life Cycle Models and Saving [H550] Social Security and Public Pensions [J260] Retirement; Retirement Policies [J640] Unemployment : Models, Duration, Incidence, and Job Search
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Christian Jaag christian.jaag@swiss-economics.ch Christian Keuschnigg christian.keuschnigg@unisg.ch Mirela Keuschnigg keuschnigg@bluewin.ch
