Pub Date : 2025-12-01Epub Date: 2025-08-06DOI: 10.1016/j.labeco.2025.102761
Marie Lalanne
Social contacts help getting a job through two mechanisms: by providing information on job opportunities or working conditions to job seekers and by providing information on candidates to employers. This paper shows empirical evidence of the second mechanism: social contacts bring job referrals. I use extensive data on social networks and referrals on all directors of large listed US companies between 2004 and 2008. Compared to non-connected new directors, connected new directors are 14% more likely to be referred by current board members with whom they share employment history. Theoretical predictions help discriminating between information provision and favoritism: referrals help select directors with higher ability, in particular the type of ability that is at best only partially observed at the time of hiring.
{"title":"Social networks and job referrals in recruitment","authors":"Marie Lalanne","doi":"10.1016/j.labeco.2025.102761","DOIUrl":"10.1016/j.labeco.2025.102761","url":null,"abstract":"<div><div>Social contacts help getting a job through two mechanisms: by providing information on job opportunities or working conditions to job seekers and by providing information on candidates to employers. This paper shows empirical evidence of the second mechanism: social contacts bring job referrals. I use extensive data on social networks and referrals on all directors of large listed US companies between 2004 and 2008. Compared to non-connected new directors, connected new directors are 14% more likely to be referred by current board members with whom they share employment history. Theoretical predictions help discriminating between information provision and favoritism: referrals help select directors with higher ability, in particular the type of ability that is at best only partially observed at the time of hiring.</div></div>","PeriodicalId":48153,"journal":{"name":"Labour Economics","volume":"97 ","pages":"Article 102761"},"PeriodicalIF":2.6,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145050113","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-01Epub Date: 2025-09-18DOI: 10.1016/j.labeco.2025.102770
Radine Rafols
I study how early gender beliefs shape the labor market consequences of parenthood. Drawing on panel data from the NLSY79, I document sharp and persistent gender gaps in wages, hours, employment, and earnings following childbirth. Mothers with egalitarian norms exhibit stronger labor force attachment and suffer smaller penalties across all outcomes. To understand mechanisms, I demonstrate that gender norms affect decisions that typically correlate with labor market success. A causal mediation analysis reveals that the indirect effect of norm beliefs on fertility explain a sizable share of the gap between modern and traditional mothers, while education, marriage timing, and occupational sorting play more limited roles.
{"title":"Gender norms and child penalties","authors":"Radine Rafols","doi":"10.1016/j.labeco.2025.102770","DOIUrl":"10.1016/j.labeco.2025.102770","url":null,"abstract":"<div><div>I study how early gender beliefs shape the labor market consequences of parenthood. Drawing on panel data from the NLSY79, I document sharp and persistent gender gaps in wages, hours, employment, and earnings following childbirth. Mothers with egalitarian norms exhibit stronger labor force attachment and suffer smaller penalties across all outcomes. To understand mechanisms, I demonstrate that gender norms affect decisions that typically correlate with labor market success. A causal mediation analysis reveals that the indirect effect of norm beliefs on fertility explain a sizable share of the gap between modern and traditional mothers, while education, marriage timing, and occupational sorting play more limited roles.</div></div>","PeriodicalId":48153,"journal":{"name":"Labour Economics","volume":"97 ","pages":"Article 102770"},"PeriodicalIF":2.6,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145118903","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-01Epub Date: 2025-09-14DOI: 10.1016/j.labeco.2025.102803
Feicheng Wang , Zhe Liang , Hartmut Lehmann
This paper investigates the impact of trade liberalization-induced labor demand shocks on precarious employment in China. Employing a local labor market approach, we construct a regional measure of exposure to import tariffs and link it to individuals’ employment status and the proportion of precarious employment within firms. Analyzing three waves of household survey data between 1995 and 2007, we find that lower import tariffs contributed to a higher likelihood of precarious employment. To understand the mechanisms, we provide novel firm-level analysis, showing that firms tended to increase the share of temporary employment with lower tariffs. Further results reveal substantial heterogeneity among firms in response to import competition. Smaller and less productive firms employed more temporary workers, whereas larger and more productive firms increased investments in innovation. We also find that hiring temporary workers was associated with lower productivity gains.
{"title":"Import competition and the rise of precarious employment: Evidence from individual-level and firm-level data in China","authors":"Feicheng Wang , Zhe Liang , Hartmut Lehmann","doi":"10.1016/j.labeco.2025.102803","DOIUrl":"10.1016/j.labeco.2025.102803","url":null,"abstract":"<div><div>This paper investigates the impact of trade liberalization-induced labor demand shocks on precarious employment in China. Employing a local labor market approach, we construct a regional measure of exposure to import tariffs and link it to individuals’ employment status and the proportion of precarious employment within firms. Analyzing three waves of household survey data between 1995 and 2007, we find that lower import tariffs contributed to a higher likelihood of precarious employment. To understand the mechanisms, we provide novel firm-level analysis, showing that firms tended to increase the share of temporary employment with lower tariffs. Further results reveal substantial heterogeneity among firms in response to import competition. Smaller and less productive firms employed more temporary workers, whereas larger and more productive firms increased investments in innovation. We also find that hiring temporary workers was associated with lower productivity gains.</div></div>","PeriodicalId":48153,"journal":{"name":"Labour Economics","volume":"97 ","pages":"Article 102803"},"PeriodicalIF":2.6,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145690594","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-01Epub Date: 2025-08-29DOI: 10.1016/j.labeco.2025.102784
Yawen Ding , Xiaobing Wang , Alan de Brauw , Huanguang Qiu
This paper exploits the staggered timing of relocations across eligible households to examine its impact on female’s labour market outcomes, under China’s Poverty Alleviation Relocation Program (PARP). Utilizing four waves of household panel data that retrospectively record individuals’ off-farm employment histories from 2011 to 2021, we find that relocation significantly increases the likelihood of off-farm employment among working-age women. However, it has limited effects on their annual working months, monthly wages, and annual earnings once being off-farm employed. Furthermore, the program’s impact on men’s off-farm employment is modest compared to that for women, suggesting that although PARP is designed to be gender-neutral, it has generated more favorable labour market effects for women than for men. Heterogeneity analysis further reveals that the increase in women’s off-farm employment is more pronounced among those with lower educational attainment, those who are married, those with resident children, as well as those relocated to urban or collective sites. We also provide suggestive evidence that improved time allocation and reshaped social networks may be mechanisms encouraging women to step out of the home.
{"title":"Women as breadwinners: A multifaceted relocation program and women’s labour market outcomes","authors":"Yawen Ding , Xiaobing Wang , Alan de Brauw , Huanguang Qiu","doi":"10.1016/j.labeco.2025.102784","DOIUrl":"10.1016/j.labeco.2025.102784","url":null,"abstract":"<div><div>This paper exploits the staggered timing of relocations across eligible households to examine its impact on female’s labour market outcomes, under China’s Poverty Alleviation Relocation Program (PARP). Utilizing four waves of household panel data that retrospectively record individuals’ off-farm employment histories from 2011 to 2021, we find that relocation significantly increases the likelihood of off-farm employment among working-age women. However, it has limited effects on their annual working months, monthly wages, and annual earnings once being off-farm employed. Furthermore, the program’s impact on men’s off-farm employment is modest compared to that for women, suggesting that although PARP is designed to be gender-neutral, it has generated more favorable labour market effects for women than for men. Heterogeneity analysis further reveals that the increase in women’s off-farm employment is more pronounced among those with lower educational attainment, those who are married, those with resident children, as well as those relocated to urban or collective sites. We also provide suggestive evidence that improved time allocation and reshaped social networks may be mechanisms encouraging women to step out of the home.</div></div>","PeriodicalId":48153,"journal":{"name":"Labour Economics","volume":"97 ","pages":"Article 102784"},"PeriodicalIF":2.6,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145690597","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-01Epub Date: 2025-11-02DOI: 10.1016/j.labeco.2025.102817
Shira Buzaglo-Baris
This paper analyzes the gender wage gap across various margins in the labor market: between industries, between firms within industries, and within firms, with a particular focus on parenthood — an event that significantly shapes the gender wage gap. Using comprehensive Employer-Employee administrative data from Israel, the study finds that industry sorting is the primary driver, explaining 22% of the overall gender wage gap, with an additional 4% attributable to women sorting into lower-paying firms within the same industry. Sorting intensifies following parenthood, as mothers are less likely to move to higher-paying firms, especially within the industry. In high-paying industries, mothers tend to accept positions in lower-paying firms while maintaining their relative industry position, whereas in low-paying industries, fathers advance faster up the industry ladder, reinforcing a motherhood penalty at the industry-level. These findings suggest that women’s initial sorting into industries has long-lasting consequences.
{"title":"Firms, industries and the gender wage gap","authors":"Shira Buzaglo-Baris","doi":"10.1016/j.labeco.2025.102817","DOIUrl":"10.1016/j.labeco.2025.102817","url":null,"abstract":"<div><div>This paper analyzes the gender wage gap across various margins in the labor market: between industries, between firms within industries, and within firms, with a particular focus on parenthood — an event that significantly shapes the gender wage gap. Using comprehensive Employer-Employee administrative data from Israel, the study finds that industry sorting is the primary driver, explaining 22% of the overall gender wage gap, with an additional 4% attributable to women sorting into lower-paying firms within the same industry. Sorting intensifies following parenthood, as mothers are less likely to move to higher-paying firms, especially within the industry. In high-paying industries, mothers tend to accept positions in lower-paying firms while maintaining their relative industry position, whereas in low-paying industries, fathers advance faster up the industry ladder, reinforcing a motherhood penalty at the industry-level. These findings suggest that women’s initial sorting into industries has long-lasting consequences.</div></div>","PeriodicalId":48153,"journal":{"name":"Labour Economics","volume":"97 ","pages":"Article 102817"},"PeriodicalIF":2.6,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145465497","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-01Epub Date: 2025-09-13DOI: 10.1016/j.labeco.2025.102802
Mengying Peng , Xiaoyang Ye
This paper investigates how peer networks influence ethnic minority students’ participation in China’s affirmative action policies in higher education. Focusing on the Ethnic Minority Preparatory Classes (EMPC) program, which provides admissions advantages to ethnic minority students, we examine whether informal information transmission within peer networks affects program take-up. Using administrative data from Ningxia Hui Autonomous Region between 2014 and 2018, we define peers as ethnic minority students from the same high school and shared the same registered residence in the previous cohort. Leveraging a difference-in-differences strategy, we find that having at least one successfully admitted peer increases the likelihood of EMPC admission by around 2 percentage points (p.p.), a 17% increase relative to the baseline admission rate of 13%. Heterogeneity analyses show that male students and those in non-STEM tracks benefit more, with effects of up to 3 p.p. These findings remain robust across alternative peer definitions and cumulative exposure measures. Additional analyses using data from Guangxi Zhuang Autonomous Region further underscore the importance of peer networks in shaping information flows that influence the outcomes of affirmative action programs. These findings highlight the critical role of peer networks in reducing informational barriers and underscore the importance of peer group structure, student heterogeneity, and institutional context in shaping the effectiveness of affirmative action policies.
{"title":"Peer effects on college choice: Evidence from affirmative action in China","authors":"Mengying Peng , Xiaoyang Ye","doi":"10.1016/j.labeco.2025.102802","DOIUrl":"10.1016/j.labeco.2025.102802","url":null,"abstract":"<div><div>This paper investigates how peer networks influence ethnic minority students’ participation in China’s affirmative action policies in higher education. Focusing on the Ethnic Minority Preparatory Classes (EMPC) program, which provides admissions advantages to ethnic minority students, we examine whether informal information transmission within peer networks affects program take-up. Using administrative data from Ningxia Hui Autonomous Region between 2014 and 2018, we define peers as ethnic minority students from the same high school and shared the same registered residence in the previous cohort. Leveraging a difference-in-differences strategy, we find that having at least one successfully admitted peer increases the likelihood of EMPC admission by around 2 percentage points (p.p.), a 17% increase relative to the baseline admission rate of 13%. Heterogeneity analyses show that male students and those in non-STEM tracks benefit more, with effects of up to 3 p.p. These findings remain robust across alternative peer definitions and cumulative exposure measures. Additional analyses using data from Guangxi Zhuang Autonomous Region further underscore the importance of peer networks in shaping information flows that influence the outcomes of affirmative action programs. These findings highlight the critical role of peer networks in reducing informational barriers and underscore the importance of peer group structure, student heterogeneity, and institutional context in shaping the effectiveness of affirmative action policies.</div></div>","PeriodicalId":48153,"journal":{"name":"Labour Economics","volume":"97 ","pages":"Article 102802"},"PeriodicalIF":2.6,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145690603","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-01Epub Date: 2025-09-03DOI: 10.1016/j.labeco.2025.102785
Tianze Liu
This paper studies how industry-specific shocks affect workers with specialized skills, focusing on the impact of the burst of the dotcom bubble on the careers of IT-specialized college graduates in Sweden. Graduates entering the labor market during the bust faced sharp initial earnings penalties and lower probabilities of IT sector employment compared to boom cohorts. However, they exhibited remarkable resilience, recovering earnings by leveraging their skills in high-paying, non-IT occupations. Incumbent IT workers, while remaining within the IT sector, experienced a decline in earnings as they moved to lower-premium firms.
{"title":"How IT-specialized majors pay off: Evidence from an IT industry shock","authors":"Tianze Liu","doi":"10.1016/j.labeco.2025.102785","DOIUrl":"10.1016/j.labeco.2025.102785","url":null,"abstract":"<div><div>This paper studies how industry-specific shocks affect workers with specialized skills, focusing on the impact of the burst of the dotcom bubble on the careers of IT-specialized college graduates in Sweden. Graduates entering the labor market during the bust faced sharp initial earnings penalties and lower probabilities of IT sector employment compared to boom cohorts. However, they exhibited remarkable resilience, recovering earnings by leveraging their skills in high-paying, non-IT occupations. Incumbent IT workers, while remaining within the IT sector, experienced a decline in earnings as they moved to lower-premium firms.</div></div>","PeriodicalId":48153,"journal":{"name":"Labour Economics","volume":"97 ","pages":"Article 102785"},"PeriodicalIF":2.6,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145690592","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-01Epub Date: 2025-11-01DOI: 10.1016/j.labeco.2025.102818
Guilherme de Oliveira Lima Cagliari Marques , Mateus Gonzalez de Freitas Pinto
We investigate the persistence of US unemployment applying seasonal fractional integration (FARISMA) models to assess both seasonal and non-seasonal long-range dependence. The analysis is carried out at three levels of data aggregation: state, regional census division, and national aggregation. Using wavelet multiresolution decomposition, we separate out irregular components to assess changes in persistence in unemployment dynamics. Our findings indicate strong evidence of hysteresis in US unemployment rates, with both seasonal and non-seasonal long memory contributing to the persistence of unemployment. These results are evidence that challenges the NAIRU hypothesis, suggesting that exogenous shocks to unemployment have prolonged effects that do not dissipate within a finite time horizon.
{"title":"Persistence and seasonal long memory in unemployment in the United States","authors":"Guilherme de Oliveira Lima Cagliari Marques , Mateus Gonzalez de Freitas Pinto","doi":"10.1016/j.labeco.2025.102818","DOIUrl":"10.1016/j.labeco.2025.102818","url":null,"abstract":"<div><div>We investigate the persistence of US unemployment applying seasonal fractional integration (FARISMA) models to assess both seasonal and non-seasonal long-range dependence. The analysis is carried out at three levels of data aggregation: state, regional census division, and national aggregation. Using wavelet multiresolution decomposition, we separate out irregular components to assess changes in persistence in unemployment dynamics. Our findings indicate strong evidence of hysteresis in US unemployment rates, with both seasonal and non-seasonal long memory contributing to the persistence of unemployment. These results are evidence that challenges the NAIRU hypothesis, suggesting that exogenous shocks to unemployment have prolonged effects that do not dissipate within a finite time horizon.</div></div>","PeriodicalId":48153,"journal":{"name":"Labour Economics","volume":"97 ","pages":"Article 102818"},"PeriodicalIF":2.6,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145416836","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-01Epub Date: 2025-11-19DOI: 10.1016/j.labeco.2025.102830
Gloria Moroni , Alexander Vickery
This paper uses data from the UK Millennium Cohort Study (MCS) to study how parental divorce in early childhood affects a child’s skill development. We estimate a dynamic model of child skill formation that accounts for the endogenous nature of parental divorce including a measure of interparental conflicts. Our results show that the skill disadvantages among children of divorce stem almost entirely from the effects of selection. Here, skill gaps materialise due to disadvantages in household characteristics that also increase divorce risk. Inter-parental conflicts, parental education, and family financial resources emerge as key pre-divorce characteristics that explain divorce gaps in children’s cognitive and socio-emotional skills from age 3, through age 11. Inter-parental conflicts are often unobserved and overlooked in the literature, but our results demonstrate that they indeed play a major role, particularly for gaps in socio-emotional skills. Moreover, such gaps are found to be more pronounced among more vulnerable children, i.e. those with lower levels of socio-emotional skills.
{"title":"Divorce, parental conflicts and child skills: A story of selection","authors":"Gloria Moroni , Alexander Vickery","doi":"10.1016/j.labeco.2025.102830","DOIUrl":"10.1016/j.labeco.2025.102830","url":null,"abstract":"<div><div>This paper uses data from the UK Millennium Cohort Study (MCS) to study how parental divorce in early childhood affects a child’s skill development. We estimate a dynamic model of child skill formation that accounts for the endogenous nature of parental divorce including a measure of interparental conflicts. Our results show that the skill disadvantages among children of divorce stem almost entirely from the effects of selection. Here, skill gaps materialise due to disadvantages in household characteristics that also increase divorce risk. Inter-parental conflicts, parental education, and family financial resources emerge as key pre-divorce characteristics that explain divorce gaps in children’s cognitive and socio-emotional skills from age 3, through age 11. Inter-parental conflicts are often unobserved and overlooked in the literature, but our results demonstrate that they indeed play a major role, particularly for gaps in socio-emotional skills. Moreover, such gaps are found to be more pronounced among more vulnerable children, i.e. those with lower levels of socio-emotional skills.</div></div>","PeriodicalId":48153,"journal":{"name":"Labour Economics","volume":"97 ","pages":"Article 102830"},"PeriodicalIF":2.6,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145623332","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-01Epub Date: 2025-08-25DOI: 10.1016/j.labeco.2025.102771
Erik Hernæs , Zhiyang Jia , John Piggott , Trond Christian Vigtel
Many consider that reducing the eligibility age for pension benefits will discourage labour supply among mature workers. This paper analyses a recent Norwegian pension reform that effectively lowered the eligibility age for retirement for some workers from 67 to 62, and we find that the above proposition might not be true. For these workers, the option of flexibly claiming from age 62 is introduced while the expected present value of benefits is held constant through actuarial adjustment of the periodic pension payments. This reform provides us with a unique opportunity to isolate the impact of increased flexibility on labour supply. We employ an event-study difference-in-difference approach to study the labour supply response (measured by number of weekly working hours as well as labour earnings) on the intensive and extensive margin. For those aged from 62 to 66, the reform leads to an increase in the labour supply at the extensive margin of 1.3 percentage points with a reduction in inflow to disability, and a decrease in the intensive margin of labour supply as measured by weekly working hours. In addition, a shift in the distribution of labour earnings further supports the finding that there is a decrease in the intensive margin of labour supply. Our findings thus suggest that increased pension flexibility could promote a gradual exit from the labour market, allowing for greater individual choice and positive welfare effects. This flexibility could also be an important component of broader pension reform.
{"title":"Work less but stay longer — Mature worker responses to a flexibility reform","authors":"Erik Hernæs , Zhiyang Jia , John Piggott , Trond Christian Vigtel","doi":"10.1016/j.labeco.2025.102771","DOIUrl":"10.1016/j.labeco.2025.102771","url":null,"abstract":"<div><div>Many consider that reducing the eligibility age for pension benefits will discourage labour supply among mature workers. This paper analyses a recent Norwegian pension reform that effectively lowered the eligibility age for retirement for some workers from 67 to 62, and we find that the above proposition might not be true. For these workers, the option of flexibly claiming from age 62 is introduced while the expected present value of benefits is held constant through actuarial adjustment of the periodic pension payments. This reform provides us with a unique opportunity to isolate the impact of increased flexibility on labour supply. We employ an event-study difference-in-difference approach to study the labour supply response (measured by number of weekly working hours as well as labour earnings) on the intensive and extensive margin. For those aged from 62 to 66, the reform leads to an increase in the labour supply at the extensive margin of 1.3 percentage points with a reduction in inflow to disability, and a decrease in the intensive margin of labour supply as measured by weekly working hours. In addition, a shift in the distribution of labour earnings further supports the finding that there is a decrease in the intensive margin of labour supply. Our findings thus suggest that increased pension flexibility could promote a gradual exit from the labour market, allowing for greater individual choice and positive welfare effects. This flexibility could also be an important component of broader pension reform.</div></div>","PeriodicalId":48153,"journal":{"name":"Labour Economics","volume":"97 ","pages":"Article 102771"},"PeriodicalIF":2.6,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144925893","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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