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Journal Article

Means testing and retirement choices in Europe: a comparison of the British and Danish systems

Authors

Publication date

2005

Abstract

We develop a simulation model of household behaviour in which both the consumption/saving and labour/leisure choices are endogenous. This model is used to explore the effects of the UK and Danish state tax and benefit systems on the labour supply of workers aged 50 or over. We find that, in broad terms, differences in labour force participation can be accounted for by differences in benefit structures. Furthermore, our simulations suggest that the UK system is preferred by young people while the Danish arrangement - which imposes a larger tax burden and provides larger welfare benefits - is chosen by people of 50 or older. Notably, people older than 60 are in the majority in the simulated population. The Danish system does not promote notably greater equality over the lifetime, but it does underpin a higher level of consumption for people of 50 or older.

Published in

Fiscal Studies

Volume

26 (1):83-118

Subjects

Older People, Labour Market, Welfare Benefits, and Income Dynamics

Links

http://serlib0.essex.ac.uk/search/s?SEARCH=FISCAL+STUDIES&sortdropdown=-

Notes

Albert Sloman Library Periodicals *restricted to Univ. Essex registered users*

#508222


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