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Postponing retirement age and labor force participation: the role of family transfers*

Published online by Cambridge University Press:  17 August 2016

Pascal Belan ,
Pierre-Jean Messe  and
François-Charles Wolff
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Summary

In this paper, we examine the consequences of delaying retirement in an overlapping generations model with domestic production and parental transfers in the form of grandchild care. We show that a change in age at retirement influences the employment rates of both the young and the old. This interdependency stems from the provision of family transfers. Postponing retirement may increase time devoted to grandchild care transfers, which allows the young to work more on the labor market. We then study the conditions under which this positive family externality holds. Finally, using numerical simulations, we assess the consequences of delaying retirement on labor participation and account for public policy implications.

Résumé

Résumé

Dans cet article, nous examinons les conséquences du recul de l'âge de départ en retraite dans un modèle à générations imbriquées avec production domestique et transferts intrafamiliaux sous la forme de temps de garde des petits-enfants. Nous montrons qu'une modification de l'âge de départ en retraite modifie le taux d'emploi des seniors, mais aussi celui des jeunes en raison d'interactions avec les transferts familiaux. Dans certains cas, un départ en retraite plus tardif peut accroître le temps que les grands-parents consacrent à leurs petits-enfants, ce qui augmente l'offre de travail des jeunes parents. Nous étudions alors les conditions sous lesquelles cette externalité familiale positive est valide. Enfin, nous analysons numériquement les conséquences du recul de l'âge de départ en retraite sur l'offre de travail des jeunes et des seniors selon la paramétrisation des fonctions de production domestique.

Keywords

départ en retraiteproduction domestiquetransferts familiauxJ26Retirementdomestic productionfamily transfersJ26
Type
Research Article
Information
Recherches Économiques de Louvain/ Louvain Economic Review , Volume 76 , Issue 4 , 2010 , pp. 347 - 370
Copyright
Copyright © Université catholique de Louvain, Institut de recherches économiques et sociales 2010 

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Footnotes

***

GAINS-TEPP, Université du Maine. Email: pierre-jean.messe@univ-lemans.fr

****

LEMNA, Université de Nantes, CNAV et INED, Paris, France. Email: francois.wolff@univ-nantes.fr

*

We would like to thank two anonymous referees for their very helpful comments and suggestions. We are also indebted to Pierre Pestieau, Michael Kaganovich, André Masson and seminar participants at the Journées sur les Modèles à Générations Imbriquées (Paris), the LEN séminar (Nantes), the Seminaire scientifique de la Caisse des Dépôts (Bordeaux) and the Annual Conference of the European Society for Population Economics (Chicago). Any remaining errors are ours.

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