Labor Supply and Retirement Policy in an Overlapping Generations Model with Stochastic Fertility

Ole Hagen Jørgensen, Svend E. Hougaard Jensen

Publikation: Working paperForskning

Resumé

Using a stochastic general equilibrium model with overlapping generations, this paper studies a policy rule for the retirement age aiming at offsetting the effects on the supply of labor following fertility changes. The authors find that the retirement age should increase more than proportionally to the direct fall in labor supply caused by a fall in fertility. The robustness of this result is checked against alternative model specifications and parameter values. The efficacy of the policy rule depends crucially on the link between the preference for leisure and the response of the intensive margin of labor supply to changes in the statutory retirement age. The model has subsequently been calibrated for Brazil by Jorgensen (2010), in the context of the Brazil Aging Study.
OriginalsprogEngelsk
Udgivelses stedWashington
UdgiverWorld Bank Publications
Antal sider19
DOI
StatusUdgivet - 2010

Emneord

  • Labor supply
  • Fertility
  • Retirement age
  • Overlapping Generations
  • Method of undertermined coe¢ cient

Citer dette

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Labor Supply and Retirement Policy in an Overlapping Generations Model with Stochastic Fertility. / Hagen Jørgensen, Ole; Hougaard Jensen, Svend E.

Washington : World Bank Publications, 2010.

Publikation: Working paperForskning

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AU - Hougaard Jensen, Svend E.

PY - 2010

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N2 - Using a stochastic general equilibrium model with overlapping generations, this paper studies a policy rule for the retirement age aiming at offsetting the effects on the supply of labor following fertility changes. The authors find that the retirement age should increase more than proportionally to the direct fall in labor supply caused by a fall in fertility. The robustness of this result is checked against alternative model specifications and parameter values. The efficacy of the policy rule depends crucially on the link between the preference for leisure and the response of the intensive margin of labor supply to changes in the statutory retirement age. The model has subsequently been calibrated for Brazil by Jorgensen (2010), in the context of the Brazil Aging Study.

AB - Using a stochastic general equilibrium model with overlapping generations, this paper studies a policy rule for the retirement age aiming at offsetting the effects on the supply of labor following fertility changes. The authors find that the retirement age should increase more than proportionally to the direct fall in labor supply caused by a fall in fertility. The robustness of this result is checked against alternative model specifications and parameter values. The efficacy of the policy rule depends crucially on the link between the preference for leisure and the response of the intensive margin of labor supply to changes in the statutory retirement age. The model has subsequently been calibrated for Brazil by Jorgensen (2010), in the context of the Brazil Aging Study.

KW - Labor supply

KW - Fertility

KW - Retirement age

KW - Overlapping Generations

KW - Method of undertermined coe¢ cient

KW - Overlapping Generations

KW - Method of undertermined coe¢ cient

KW - Retirement age

KW - Fertility

KW - labor Support

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