French Retirement Reforms and Intragenerational Equity in Retirement Duration

Abstract

Abstract:The French retirement reform of 1983 has created a particular framework where the age at which an individual can retire and receive a full-rate pension is conditional to both a legal minimum age and a required insurance duration. This framework may be seen as a way to compensate inequalities as regards retirement duration by allowing low-life expectancy workers to retire earlier. Indeed, life expectancy increases with education and the level of earnings. Low-educated workers, who entered the labor market earlier than high-educated workers, may reach the required insurance duration, and thus retire, earlier. However, the extent with which the framework of the pension system may allow compensating inequalities might have changed due to the 1993, 2003 and 2010 reforms, which modified either the insurance duration or the minimum age criteria. In this paper, we address empirically the extent of redistribution as regards retirement duration across social groups using a singular modeling of professional career and retirement decision based on a large administrative datasets: the so-called PROMESS model. We show that increasing the required duration criterion -as was done by the 1993 and 2003 reformsseems to have redistributive impact, as far as retirement duration is concerned. For instance, theses two reforms increase the average retirement age in 2030 by 17 months for male workers in the higher wage quartile, but by 11 months only for male workers in the lower wage quartile.

The effects on intra‐generational inequality of introducing a funded pension scheme: A microsimulation analysis for Estonia

“…Several studies have analysed the potential effects of pension systems and their reforms on intra‐generational inequality (see for example, Karayel, ; Lefèbvre, ; He, ; Bonenkamp, ; Klazar and Slintáková, ; van Vliet et al, ; Aubert, Duc and Ducoudré, ). To measure generational distribution and test for inequality in pensions, other studies have used Net Present Value and Expected Utility (Auerbach and Lee, ) as well as the individual Internal Rate of Return of different career patterns (Nisticò and Bevilacqua, and ).…”

A Brief Analysis of the Superiority of Mandatory Human Rights Due Diligence Law from the Perspective of Retirement Right

“…The simulation results showed that the redistribution effect of the extension of retirement age was in reverse relationship. That is to say, the extension of retirement age cannot realize the redistribution of income among different income groups [16].…”