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Do notional defined contribution schemes prolong working life?: Evidence from the 1994 Swedish pension reform
Stockholm University, Faculty of Social Sciences, Department of Sociology. Lund University, Sweden.ORCID iD: 0000-0003-0268-1471
2016 (English)In: The Journal of the Economics of Ageing, ISSN 2212-828XArticle in journal (Refereed) Epub ahead of print
Abstract [en]

This paper investigates whether the Notional Defined Contribution (NDC) scheme prolongs working life. The evidence from the 1994 Swedish pension reform shows a gender and socio-economic gradient in the labor supply responses to phasing in NDC. While the reform exerted a large and significant positive effect on the average retirement age among highly educated and skilled, it had little or negative effect on those with low level of human capital. And the overall effect is more profound among older men, compared to older women. These findings imply that the aggregate impact of NDC may only be positive if the average level of older workers’ education and skills is high, whereas it may be moderate (or even adverse) if the majority of the older workers are less educated and engage in low-skill jobs. This highlights the importance of incorporating the gender and socio-economic aspects into the evaluation of how a multi-pillar pension scheme, such as NDC, may increase the average working life expectancy.

Place, publisher, year, edition, pages
Keyword [en]
Education, Occupation, Pension, Reform, Retirement
National Category
Research subject
Demography; Economics
URN: urn:nbn:se:su:diva-136999DOI: 10.1016/j.jeoa.2016.11.001OAI: diva2:1058231
EU, FP7, Seventh Framework Programme, 613247
Available from: 2016-12-20 Created: 2016-12-20 Last updated: 2016-12-30

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Qi, Haodong
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