Template-Type: ReDIF-Paper 1.0
Title: Reference Points for Retirement Behavior: Evidence From German Pension Discontinuities
Author-Name: Arthur Seibold
Author-Email: seibold@uni-mannheim.de

Classification-JEL: H55, J26, D91
Keywords: Pensions, retirement, reference dependence

Abstract: This paper studies the large concentration of retirement behavior around statutory retirement
ages, a puzzling stylized fact. To investigate this fact, I estimate bunching responses to 644
pension benefit discontinuities, using administrative data on the universe of German retirees.
Financial incentives alone cannot explain retirement patterns, but there is a large direct effect
of statutory retirement ages. I argue that the framing of statutory ages as reference points
for retirement provides a plausible explanation. Simulations based on a model with reference
dependence highlight that shifting statutory ages via pension reforms is an effective policy to
influence retirement behavior.

Note: 
Length: 94
Creation-Date: 2020-10
Revision-Date: 
File-URL: https://www.crctr224.de/research/discussion-papers/archive/dp226
File-Format: application/pdf
Handle: RePEc:bon:boncrc:CRCTR224_2020_226