A structural model for early exit of older men in Belgium

• Published in: Empirical economics Vol. 43; no. 1; pp. 379 - 398
• Main Authors: Lefebvre, Mathieu, Orsini, Kristian
• Format: Journal Article Web Resource
• Language: English
• Published: Berlin/Heidelberg Springer-Verlag 01-08-2012; Springer Nature B.V; Springer Science & Business Media B.V
• Subjects: Age; Business & economic sciences; Dynamic programming; Early retirement; Earnings; Econometrics; Economic systems & public economics; Economic Theory/Quantitative Economics/Mathematical Methods; Economics; Economics and Finance; Finance; Insurance; Labor force; Labor supply; Management; Older workers; Sciences économiques & de gestion; Statistics for Business; Systèmes économiques & économie publique; Wages & salaries; Social security reforms; Microsimulation; C15; E17; D91; Retirement; C51; J26
• ISSN: 0377-7332; 1435-8921; 1435-8921
• DOI: 10.1007/s00181-011-0480-1

In this article, we propose a structural model of the retirement decision for older workers in Belgium. We model the exit paths available through the various available schemes. Our framework allows exploiting all information on possible exit paths and also better identifying preferences and constraints. Results based upon Belgian microsimulation data from 2001 for private sector workers fits rather well-observed behavior. Simulations of hypothetical reforms illustrate the potential effects of changing social security rules.