Progressive retirement: a solution to work longer?

Details

Supervisors

Hindriks, Jean

Faculty

Faculté des sciences économiques, sociales, politiques et de communication

Degree label

Master [120] en sciences économiques, orientation générale

Abstract

The investigation based on a literature review and a theoretical model sheds light on the scope of progressive retirement schemes. First, unlike subsidized working time reduction schemes targeted for older workers to reduce unemployment by sharing work, they mean to remove implicit taxes on work and to move towards actuarial neutrality for pension benefits. Second, although the reduction of minimum working hours constraints should extend working lives, it may not be successful at increasing labour supply compared to a flexible full-time retirement scheme as the labour volume variations highly depend upon the distribution of disutility of work. The major benefit is to further enhance welfare as it provides a smooth individualized transition into retirement. The combination of both allows flexibility with responsibility. Quasi-fixed labour costs borne by firms should eventually be taken into account insofar as they account for minimum working hours constraints.