Ageing workforce and productivity: the unintended effects of retirement regulation in Italy
Making use of the quasi-natural experimental setting provided by the unexpected and sudden change in Italian retirement legislation at the end of 2011 (Fornero law), this article estimates the effect on productivity of a reduction of sorting mechanisms among older workers. The estimation uses provincial-level data. The increase of retirement age and restrictions on early retirement plans locked older employees into the workplace with a negative impact on productivity. Assessing the sorting effect contributes to the age-productivity debate, isolating more precisely the average effect of ageing on productivity.
KeywordsAgeing workforce Labour productivity Pension reforms Quasi-natural experiments
JEL ClassificationC33 H55 J26 O47
The research has been supported by a joint project of the University of Trento and the Provincia Autonoma di Trento.
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