Template-Type: ReDIF-Paper 1.0
Author-Name: Terhi Ravaska
Author-Name-First: Terhi
Author-Name-Last: Ravaska
Author-Email: terhi.ravaska@tuni.fi
Author-Workplace-Name: Tampere University & VATT Institute for Economic Research
Title: Do reduced working hours for older workers have health consequences and prolong work careers?
Abstract: I examine the effects of reduced working hours on various health outcomes. I
focus on individuals close to retirement and exploit a reform in part-time pen-
sion rules. Using detailed register data on health and job spells together with a
difference-in-differences approach, I find that an earlier eligibility age for part-time
pension program increased purchases of prescription drugs by approximately 1.0
percentage point over the following 6 years. In relative terms, this effect is small,
around 2%, but is economically significant as drug purchases are largely subsidized
by the state. However, looking at the long-term effects I do not find effects on
mortality or severe health diagnoses. I also look at labour market exits and find
that the reform did not reduce the risk of early withdrawal from the labour market.
Length: 48 pages
Creation-Date:  2023-02
Publication-Status: Published in FIT Working Paper Series, Finnish Center of Excellence in Tax Systems Research
File-URL: https://verotutkimus.fi/verotutkimus/wp-content/uploads/2023/02/FIT-WP6-Ravaska-1.pdf
File-Format: Application/pdf
File-Function: First version, 2023
Number: 6
Classification-JEL: I11, H42, I18
Keywords: taxation, emigration
Handle: RePEc:fit:wpaper:6