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Retirement blues

Heller-Sahlgren, Gabriel (2017) Retirement blues. Journal of Health Economics, 54. pp. 66-78. ISSN 0167-6296

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Identification Number: 10.1016/j.jhealeco.2017.03.007

Abstract

This paper analyses the short- and longer-term effects of retirement on mental health in ten European countries. It exploits thresholds created by state pension ages in an individual-fixed effects instrumental-variable set-up, borrowing intuitions from the regression-discontinuity design literature, to deal with endogeneity in retirement behaviour. The results display no short-term effects of retirement on mental health, but a large negative longer-term impact. This impact survives a battery of robustness tests, and applies to women and men as well as people of different educational and occupational backgrounds similarly. Differences compared with previous research are attributed to the study's differentiation of short- and longer-term effects as well as its research design. Overall, the paper's findings suggest that reforms inducing people to postpone retirement are not only important for making pension systems solvent, but with time could also pay a mental health dividend among the elderly and reduce public health care costs.

Item Type: Article
Official URL: http://www.sciencedirect.com/science/journal/01676...
Additional Information: © 2017 Elsevier B.V.
Divisions: Social Policy
Centre for Economic Performance
Subjects: H Social Sciences > HM Sociology
R Medicine > RC Internal medicine
JEL classification: I - Health, Education, and Welfare > I1 - Health > I10 - General
J - Labor and Demographic Economics > J1 - Demographic Economics > J14 - Economics of the Elderly; Economics of the Handicapped
J - Labor and Demographic Economics > J2 - Time Allocation, Work Behavior, and Employment Determination and Creation; Human Capital; Retirement > J26 - Retirement; Retirement Policies
Sets: Departments > Social Policy
Research centres and groups > Centre for Economic Performance (CEP)
Date Deposited: 07 Apr 2017 16:29
Last Modified: 20 Jun 2020 02:26
Projects: ES/J500070/1
Funders: Economic and Social Research Council, Jan Wallander and Tom Hedelius Foundation
URI: http://eprints.lse.ac.uk/id/eprint/73079

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