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ifo Institut – Leibniz-Institut für Wirtschaftsforschung an der Universität München >
CESifo Working Papers, CESifo Group Munich >
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http://hdl.handle.net/10419/19035
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| Title: | | Early retirement and social security : a long term perspective  |
| Authors: | | Conde-Ruiz, Jose Ignacio Galasso, Vincenzo Profeta, Paola |
| Issue Date: | | 2005 |
| Series/Report no.: | | CESifo working papers 1571 |
| Abstract: | | We provide a long-term perspective on the individual retirement behaviour and on the future of retirement. In a Markovian political economic theoretical framework, in which incentives to retire early are embedded, we derive a political equilibrium with positive social security contribution rates and early retirement. Aging has two opposite effects: it leads to lower taxes and fewer (early) retirees, while a poorer median voter will push for higher contributions. The model highlights the existence of crucial income effects: a decrease of the income of young people will induce them to postpone retirement and to vote for less social security. |
| Subjects: | | pensions income effect tax burden politico-economic Markovian equilibrium |
| JEL: | | H55 D72 H53 |
| Document Type: | | Working Paper |
| Appears in Collections: | | CESifo Working Papers, CESifo Group Munich
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