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1 – 10 of over 14000Alan L. Gustman and Thomas L. Steinmeier
Using data from the Health and Retirement Study, we examine behavioral responses to a new generation of retirement policies that on average are actuarially neutral. Although many…
Abstract
Using data from the Health and Retirement Study, we examine behavioral responses to a new generation of retirement policies that on average are actuarially neutral. Although many conventional models predict that actuarially neutral policies will not affect retirement behavior, our model allows those with high-time preference rates to find that the promise of an actuarially fair increase in future rewards does not balance the loss from foregone current benefits. Thus together with liquidity constraints facing those with high-time preference, we find that actuarially neutral policies do affect retirement behavior. One such policy follows on the elimination of the Social Security earnings test for those over normal retirement age, and would eliminate the earnings test between early and normal retirement age. Another of these policies would increase the ages of benefit entitlement. Still another such policy emerges from a central focus of the past few years on the adoption of personal accounts. Although Social Security benefits are currently paid in the form of an annuity, benefits from either defined benefit plans or from personal accounts may be made available as an annuity or as a lump sum of equivalent actuarial value. A related policy choice between actuarially equivalent benefits emerges on the pension side. There has been discussion of relaxing the current IRS prohibition against paying a pension benefit when a person remains at work, instead allowing partial pension benefits to be paid to those who partially retire on a job.
Early retirement in the Arabian Gulf States and in Kuwait inparticular became a public issue before and after the Gulf War. Reportsa recent study of Kuwaiti nationals who retired…
Abstract
Early retirement in the Arabian Gulf States and in Kuwait in particular became a public issue before and after the Gulf War. Reports a recent study of Kuwaiti nationals who retired from the Government sector from 1979 to 1989: more than 84 per cent of the sample were 50 years of age and younger; more than 70 per cent of the women and 52 per cent of the men were college graduates; more than 74 per cent of the women and 32 per cent of the males spent less than 25 years in service; and more than 51 per cent of men and 42 per cent of women worked after their retirement. The sample considered early retirement benefits and management‐organizational factors to be the major influences on their early retirement decision and proposed improving the management‐organization factors through training, managerial development, career development, and counselling as means for reducing the outflow of Kuwaiti manpower from the Government sector, and offsetting the early retirement trend.
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Amy M. Warren and E. Kevin Kelloway
The purpose of this study is to use the theory of planned behavior to test a structural model of retirement timing intentions of older workers in Canada following the abolishment…
Abstract
Purpose
The purpose of this study is to use the theory of planned behavior to test a structural model of retirement timing intentions of older workers in Canada following the abolishment of mandatory retirement.
Design/methodology/approach
A survey of 281 working individuals was conducted in order to test a model of retirement timing.
Findings
The model was a good fit to the data. Attitudes toward people at work predicted people's attitudes toward work. Attitudes toward work predicted age and life perceptions. Age and life perceptions predicted control. Control predicted social/policy influences, and finally social/policy influences predicted planned retirement age.
Research limitations/implications
The main limitations of this study were that the authors tested a model based on self report data. Furthermore the data were correlational therefore they cannot make causal inferences.
Practical implications
Work attitudes predict people's own perceptions of their life and age. And these are predictive of norms. Organizations need to consider people's perceptions of their work, if they are to retain workers past the normal retirement age. Implementing work practices/policies, e.g. flexible work, become key considerations for these organizations.
Originality/value
The authors now have empirical support for the contention that norms are important for investigating the short term effects of lifting mandatory retirement, but also when considering the long term effects that changing mandatory retirement policies may have on individual's retirement timing. Furthermore, they have a more comprehensive model of retirement timing.
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Sudip Gupta and Jayanta Kumar Seal
The purpose of this study is to find out the effect of consumption tax on savings behavior especially on the people who are close to their retirement.
Abstract
Purpose
The purpose of this study is to find out the effect of consumption tax on savings behavior especially on the people who are close to their retirement.
Design/methodology/approach
The authors analyze the response in spending and retirement saving using a difference-in-differences regression methodology. The authors use the year since the Public Provident Fund (PPF) enrollment date for each individual as a random assignment to identify the service tax policy's causal impact. Therefore, this variable is a continuous variable defined as an individual's age until the end of the restrictions when people can withdraw money from their retirement savings account PPF without any penalty. The treatment variable is the service tax shock (increase in service tax) that happened effective 1st April 2015.
Findings
The authors find a significant effect of a change in the service tax rate on individuals' spending and PPF saving behavior. On average, individuals lower their consumption by about 14% and increase their PPF savings by 16% in response to the increase in the service tax rate. The authors find substantial heterogeneity in effect across different types of individuals. The effect is more pronounced for people closer to their retirement and needy people (defined as individuals with low traditional savings account balances).
Research limitations/implications
The authors studied the effect of consumption tax on one category of savings (PPF) only. There are other savings instruments available in India. The data for those were not available to us.
Practical implications
This paper not only throws light on the consumption and savings behaviour of the individuals, but will also help the policy maker for framing appropriate fiscal policy.
Originality/value
Using a unique and proprietary data from a large bank in India, the authors analyze the effect of a tax policy change on households' consumption and retirement savings behavior. The authors find that households reduce their consumption by 14% and increase their voluntary retirement savings (Public Provident Fund aka PPF) by 16% in response to an increase in the service tax policy. Individuals close to their retirement age (55 years of age and above) and without any withdrawal restrictions from their PPF account tend to reduce their expenditures more and save more. Individuals with financial constraints and withdrawal restrictions do not reduce their expenditures significantly. To the best of the authors’ knowledge no study was done on this.
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Yehuda Baruch, Susan Sayce and Andros Gregoriou
– The purpose of this paper is to explore potential benefits and possible pitfalls of the removal of the default retirement age.
Abstract
Purpose
The purpose of this paper is to explore potential benefits and possible pitfalls of the removal of the default retirement age.
Design/methodology/approach
A human capital and labour market perspective provide theoretical lenses for exploring the potential implications for individuals, organizations and societies. The paper employs financial costing analysis to demonstrate.
Findings
The paper uses the UK case to illustrate anticipated managerial and societal outcomes. The main finding from the discussion and the financial analysis is that indeed the current system is unsustainable.
Originality/value
The paper offers areas where lessons about age management can be learnt from other experiences of flexible retirement strategies such as enhancing older workers ' human capital. The idea is of global nature and relevance and forms a “wake-up call” for decision makers at national level.
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It is common for police services to set mandatory retirement ages at a relatively young level. The aim of this paper is to discuss the reasons for, and workforce planning…
Abstract
Purpose
It is common for police services to set mandatory retirement ages at a relatively young level. The aim of this paper is to discuss the reasons for, and workforce planning implications of, mandatory retirement within the context of the London Metropolitan Police Service (MPS).
Design/methodology/approach
This research is based on in‐depth interviews with seven senior human resource managers and two trade union representatives in the MPS.
Findings
Workforce planning issues shaped managers' perceptions of the need for a mandatory retirement age of 60 for police constables. On the one hand, they were under pressure to increase the number of constables, and the possibility of extending working life was seen as one means to that end. On the other, it was feared that the retention of older police officers would lead to career blockages for younger police constables rising through the ranks.
Practical implications
Owing to labour and skills shortages, MPS managers were looking for ways to encourage older police officers to delay retirement. Innovative practices, such as offering flexible working hours, mentoring roles and pension incentives as alternatives to retirement were identified.
Originality/value
The qualitative data put the discussion of mandatory retirement in police services within the context of workforce planning rather than capability. For police authorities that maintain mandatory retirement policies, raising or abolishing retirement age would change the workforce planning paradigm in which police officers are recruited from, and retire at, young ages.
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Rafael Gomez, Morley Gunderson and Andrew Luchak
Issues associated with retirement in general, and phased transitions into retirement in particular, are taking on increased importance for a variety of reasons. Outlines those…
Abstract
Issues associated with retirement in general, and phased transitions into retirement in particular, are taking on increased importance for a variety of reasons. Outlines those reasons, paying particular attention to the practice of mandatory retirement. Presents age dependency ratios for the OECD to highlight the importance of these issues in the context of an ageing and longer‐lived workforce relative to a smaller working age population. Then discusses the prevalence of mandatory retirement in Canada and the USA, and presents empirical evidence from Canada on variables associated with retiring because of mandatory retirement. The Canadian case is of particular interest, because mandatory retirement in Canada has generally not been banned, which is in marked contrast with the situation in the USA, where it has been banned as constituting age discrimination. The public and legal debate over the issue of mandatory retirement has also been extensive in Canada, and this debate may provide information for other countries dealing with the issue. Ends with an assessment of the extent to which mandatory retirement exerts a constraining influence on transitions into retirement. The essential argument is that its constraining impact is not as simple as it may initially appear. To the extent that mandatory retirement is an intricate part of the compensation and human resource function of firms, banning it can have important implications for those functions and, in turn, for transitions into retirement. The complexities of these issues and dramatically increasing old‐age dependency ratios will ensure that this is an area of growing importance for public policy and human resource management.
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It is common for police services to set mandatory retirement ages at relatively young ages. This paper seeks to discuss the reasons for, and workforce planning implications of…
Abstract
Purpose
It is common for police services to set mandatory retirement ages at relatively young ages. This paper seeks to discuss the reasons for, and workforce planning implications of, mandatory retirement within the context of the London Metropolitan Police Service (MPS).
Design/methodology/approach
In‐depth interviews were carried out with seven senior human resource managers and two trade union representatives in the MPS.
Findings
Workforce planning issues shaped managers' perceptions on the need for a mandatory retirement age of 60 for police constables. On the one hand, they were under pressure to increase the number of constables, and the possibility of extending working life was seen as one means to that end. On the other, it was feared that the retention of older police officers would lead to career blockages for younger police constables rising through the ranks.
Practical implications
Owing to labour and skills shortages, MPS managers were looking for ways to encourage older police officers to delay retirement. Innovative practices, such as offering flexible working hours, mentoring roles and pension incentives as alternatives to retirement were identified.
Originality/value
The qualitative data put the discussion of mandatory retirement in police services within the context of workforce planning rather than capability. For police authorities that maintain mandatory retirement policies, raising or abolishing retirement age would change the workforce planning paradigm in which police officers are recruited from, and retire at, young ages.
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James W. Walker and Karl F. Price
Retirement: is it the ‘golden years’ or is it relegation to the ‘human scrapheap’? In reality, it may be either, depending on a multitude of factors interrelated in a complex…
Abstract
Retirement: is it the ‘golden years’ or is it relegation to the ‘human scrapheap’? In reality, it may be either, depending on a multitude of factors interrelated in a complex process. This paper presents a model that describes this process and explains the retirement decision in behavioural terms. The model also shows the interaction between environmental, institutional and individual variables; their impact on retirement; and the impact of retirement upon them.