Don't Raise the Retirement Age! An Experiment on Opposition to Pension Reforms and East-West Differences in Germany

47 Pages Posted: 23 Aug 2009

See all articles by Beatrice Scheubel

Beatrice Scheubel

European Central Bank (ECB); Ludwig Maximilian University of Munich (LMU) - Center for Economic Studies (CES)

Daniel Schunk

Johannes Gutenberg University Mainz - Gutenberg School of Economics and Management; University of Zurich - Department of Economics

Joachim K. Winter

Ludwig Maximilian University of Munich (LMU); CESifo (Center for Economic Studies and Ifo Institute); Max Planck Society for the Advancement of the Sciences - Munich Center for the Economics of Aging (MEA); Deutsche Bundesbank - Research Department

Date Written: August 2009

Abstract

For policy reforms to increase a society's welfare, reliable information on people's prefer-ences and expectations is crucial. Representative opinion polls, often involving simplified questions about the complex topics under debate, are an important source of information for both policy-makers and the public. Do people's answers to these poll questions reliably reflect their preferences and expectations, or does fundamental, undiscriminating opposition to reforms distort them? We address this question in the context of a recent German pension reform which raised the statutory retirement age by two years to age 67. By introducing an experiment into a representative household survey, we are able to disentangle expectations of work ability at retirement and fundamental opposition. Our results show that expected work ability declines substantially with increasing target age (63, 65, or 67 years). Answers from West German respondents reflect their current life situation as well as individual health and other risk factors. However, a fundamental opposition to reforms of the welfare state appears to strongly affect responses from East German households.

Keywords: retirement, health, work ability, survey experiment, public opinion poll, PAYG pension system, East Germany

JEL Classification: J10, H30, H55, D84

Suggested Citation

Scheubel, Beatrice and Schunk, Daniel and Winter, Joachim K., Don't Raise the Retirement Age! An Experiment on Opposition to Pension Reforms and East-West Differences in Germany (August 2009). CESifo Working Paper Series No. 2752, Available at SSRN: https://ssrn.com/abstract=1458849 or http://dx.doi.org/10.2139/ssrn.1458849

Beatrice Scheubel

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

Ludwig Maximilian University of Munich (LMU) - Center for Economic Studies (CES)

Schackstr. 4
Munich, 80539
Germany

Daniel Schunk (Contact Author)

Johannes Gutenberg University Mainz - Gutenberg School of Economics and Management ( email )

Mainz
Germany

University of Zurich - Department of Economics ( email )

Bluemlisalpstr. 10
Zurich, 8006
Switzerland

Joachim K. Winter

Ludwig Maximilian University of Munich (LMU) ( email )

Geschwister-Scholl-Platz 1
Munich, DE Bavaria 80539
Germany

CESifo (Center for Economic Studies and Ifo Institute) ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

Max Planck Society for the Advancement of the Sciences - Munich Center for the Economics of Aging (MEA) ( email )

Amalienstrasse 33
Munich, 80799
Germany

Deutsche Bundesbank - Research Department ( email )

PO Box 10 06 02
D60006 Frankfurt
Germany

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