Spousal and Survivor Benefits in Option Value Models of Retirement: An Application to Belgium

Alain Jousten and Mathieu Lefebvre

No 10246, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We study retirement incentives with augmented option value model à la Stock and Wise (1990). We propose methodological extensions to better reflect the respective incentives faced by singles and couples. Our results show that a more comprehensive modelling of couples' incentives leads to very different patterns of retirement incentives – particularly for women. We apply the new indicators to data from the Survey of Health, Ageing and retirement in Europe (SHARE) in Belgium and find two key results. First, contrary to several previous studies, we obtain a positive signed income effects. Second, we find very different retirement incentives for men and women, with little flexibility in the retirement decision for men and substantially more flexibility for women as a function of financial incentives and household composition.

Keywords: dependent benefits; social security; retirement (search for similar items in EconPapers)
JEL-codes: H55 J21 J26 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2016-09
New Economics Papers: this item is included in nep-age and nep-eur
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Published - published in: Journal of Pension Economics & Finance, 2019, 18 (1), 66 - 87

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Related works:
Journal Article: Spousal and survivor benefits in option value models of retirement: an application to Belgium (2019)
Working Paper: Spousal and survivor benefits in option value models of retirement: an application to Belgium (2019)
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