An empirical analysis of retirement behaviour in Spain: partial versus full retirement

Abstract

In several developed countries, the ageing process of the population may pose fiscal risks to the PAYG systems of public pensions. This paper studies the determinants of two forms of accessing retirement in Spain, either partial or full retirement. Our goal is to identify if social security legislation influences the choice between these two alternative paths. Using a newly released data set we estimate a multinomial logit duration model including different measures capturing the economic incentives embedded in the social security system. Our results show that social security incentives determine individual retirement decisions. Besides, partial retirement legislation modifies the selection of retirement routes and affects the age of retirement moving it to an earlier date.

Trends in Employment and Social Security Incentives in the Spanish Pension System

“…Although these reforms tried to increase the labor supply of older male workers, the existing evidence (see, e.g., Cairó-Blanco 2010;García-Pérez et al 2013) does not show any clear link between these reforms and the increased labor supply of older male workers.…”