an article by Ewa Gałecka-Burdziak (Warsaw School of Economics) and Marek Góra (Warsaw School of Economics and IZA) published in IZA Journal of European Labor Studies Volume 5 Article 18 (2016
Abstract
We examine whether easy and early access to old-age benefits induce older workers to become inactive. We use Polish LFS data.
We find added worker effect prevailing over discouraged worker effect. The latter arises after a few quarters and is asymmetric.
Females permanently leave the workforce. More males leave the workforce in contractions than re-enter in expansions.
If old-age benefit becomes the main source of income, the worker (after 1 year) is 8 to 20 times more likely to exit the market than unemployment or social welfare beneficiaries. Our findings support higher retirement age – the age when workers become eligible for old-age benefits.
JEL classification: J14, J22
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