uu.seUppsala University Publications
Change search
ReferencesLink to record
Permanent link

Direct link
The Standard Deviation of Life-Length, Retirement Incentives, and Optimal Pension Design
Umeå Universitet.
Uppsala University, Disciplinary Domain of Humanities and Social Sciences, Faculty of Social Sciences, Department of Economics.
2010 (English)Report (Other academic)
Abstract [en]

In this paper, we consider how the retirement age as well as a tax financed pension system ought to respond to a change in the standard deviation of the length of life. In a first best framework, where a benevolent government exercises perfect control over the individuals’ labor supply and retirement-decisions, the results show that a decrease in the standard deviation of life-length leads to an increase in the optimal retirement age and vice versa, if the preferences for “the number of years spent in retirement” are characterized by constant or decreasing absolute risk aversion. A similar result follows in a second best setting, where the government raises revenue via a proportional tax (or pension fee) to finance a lump-sum benefit per year spent in retirement. We consider two versions of this model, one with a mandatory retirement age decided upon by the government and the other where the retirement age is a private decision-variable.

Place, publisher, year, edition, pages
Uppsala, 2010. , 24 p.
, Working Paper, Uppsala Center for Fiscal Studies, Uppsala University, 2010:11
Keyword [en]
lifetime, retirement, pension system
National Category
Research subject
URN: urn:nbn:se:uu:diva-131485OAI: oai:DiVA.org:uu-131485DiVA: diva2:354407
Available from: 2010-10-01 Created: 2010-10-01 Last updated: 2010-11-17Bibliographically approved

Open Access in DiVA

No full text

Other links

By organisation
Department of Economics

Search outside of DiVA

GoogleGoogle Scholar
The number of downloads is the sum of all downloads of full texts. It may include eg previous versions that are now no longer available

Total: 179 hits
ReferencesLink to record
Permanent link

Direct link