Early retirement, social security, and output gap
Identificadores
URI: http://hdl.handle.net/10481/31591Metadata
Show full item recordAuthor
Díaz-Saavedra, JuliánEditorial
Universidad de Granada. Departamento de Teoría e Historia Económica
Materia
Computable general equilibrium Social security reforms Macroeconomic effects Retirement
Date
2014-01Referencia bibliográfica
Díaz-Saavedra, J. Early retirement, social security, and output gap. Universidad de Granada. Departamento de Teoría e Historia Económica (2014). (The Papers; 14/01). [http://hdl.handle.net/10481/31591]
Sponsorship
Fi nancial support from the Spanish Ministerio de Ciencia e Innovaci ón (ECO2011-25737).Abstract
We analyze two social security reforms aimed at increasing working lifetimes. The first reform eliminates early retirement provisions, while the second increases both the age of early eligibility and the normal retirement age. We and that although both reforms increase the participation rates of older workers, the elimination of early retirement provisions reduces future social security imbalances if benefits taken early are not reduced actuarially. Additionally, we nd that both reforms increase aggregate hours and output, although e ciency gains derived from the elimination of the early retirement scheme are distant from previous estimates since labor supply could be less responsive. Finally, we also nd that the output gap brought about by the early retirement scheme may decrease in coming decades.