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Research Details

UM06-22 - The Dynamics of Work-Related Health and Labor Market Status: An International Comparison

Arie Kapteyn, Arthur van Soest, James P. Smith and James Banks

Many western industrialized countries face strong budgetary pressures due to the aging of the baby boom generations and the general trends in many of these countries toward earlier ages of retirement. The commonality of these problems, however, has the advantage of offering an empirical laboratory for the testing of programmatic incentives on the retirement decision that would not be possible in a single country where programs may only change very slowly. For example, it is important to understand policies that affect labor force participation because if people keep working, that in the long run helps the solvency of OASI. One can gauge the effect of policies by analyzing the differences in the prevalence of unemployment, early retirement or work disability across countries. This project will use the American PSID and HRS and the European Community Household Panel (ECHP) to explain differences in prevalence and dynamics of self-reports of work disability and labor force status (full-time or part-time work, unemployment, retirement, disability benefit receipt, etc.). It will analyze trends across countries, relate these to institutional differences and we will develop dynamic panel data models and use these to simulate counterfactuals that quantify the effects of policies such as the generosity and access criteria of unemployment and disability benefits.

Working Paper:
Labor Market Status and Transitions during the Pre-Retirement Years: Learning from International Differences