Quasi-dynamic forward-looking model for joint household retirement decision under AFP scheme

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Iskhakov, Fedor




Number in series: 28


Structural forward-looking quasi-dynamic behavioural model is estimated for the Norwegian households where husband is eligible for early retirement between 1993 and 1996. Random utility approach is applied to rationalize the observed shifts between four main stages on the labour market. Specific attention is paid to the retirement decisions. Based on the finest model policy simulation is run to register the impact of altering taxation on the labour force participation. The following thesis was prepared within the aging population and pension project carried out by Erik Hernæs and Steinar Strøm at the Frisch Centre for Economic Research. The project is financed by the Norwegian Research Council. The project has resulted in a whole series of papers which date back to 1997 ([Hernæs et al. 2001, 2002a, 2002b], [Dagsvik, Strøm 1997], [Brinch et al., 2002]). As the data quality increases and more data is collected with years, it is necessary to come back to some previous results to improve and correct them. The modelling details also change with time although the major path has been laid out solid. In the current research the data is substantially improved with additional occupational pension included in the dataset for the very first time. Besides, new three periods model is developed to make predictions more accurate and less restrictions are introduced on the sample selecting stage to make the models more general.


Oppdragsgiver: Norges forskningsråd
Oppdragsgivers prosjektnr.:
Frisch prosjekt: 1132 - Labour force participation among the elderly and the finances of the pension system