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Health, Pensions, and the Retirement Decision: Evidence from Canada*

  • Tammy Schirle (a1)

This article examines, on the basis of longitudinal data from the Canadian Survey of Labour and Income Dynamics, the effects of health and employer-provided pensions on retirement decisions, which have not been studied simultaneously in the Canadian context. The results indicate that employer-provided pensions have substantial and significant incentive effects on retirement behaviour. Having poor health substantially increases the likelihood of entering retirement, by up to 25 percentage points. The results corroborate previous evidence regarding the relative importance of attenuation and justification bias in self-reported health measures. Further, the results confirm U.S. and European evidence that employer-provided pensions and health are significant determinants of retirement.

En utilisant des données longitudinales de l’Enquête sur la dynamique du travail et du revenu, j’examine les effets de la santé et des régimes de pension offerts par les employeurs sur les décisions de retraite ce qui n’a pas été étudiés simultanément dans le contexte canadien. Les résultats indiquent que les régimes de pension offerts par les employeurs ont des effets incitatifs importants et significatifs sur le comportement de la retraite. Etre en mauvaise santé augmente considérablement la probabilité de prendre sa retraite, jusqu’à 25 points de pourcentage. Les résultats corroborent les résultats antérieures concernant l’importance relative de l’atténuation et le biais de la justification de l’auto-déclaration des mesures de santé. En outre les résultats confirment aussi les conclusions des recherches américains et européens, que l’état de santé et les régimes de pension offerts par les employeurs sont des déterminants importants de la retraite.

Corresponding author
Correspondence and requests for offprints should be sent to / La correspondance et les demandes de tirés-à-part doivent être adressées à: Tammy Schirle, Ph.D., Assistant Professor, Department of Economics, Wilfrid Laurier University, 75 University Avenue West, Waterloo, Ontario, Canada N2L 3C5 (
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I thank Hideki Ariizumi, Nicole Fortin, Thomas Lemieux, Kevin Milligan, participants of the Empirical lunch series at UBC, and participants of the Second Annual PWFC Symposium for their comments and suggestions. The statistical analysis in this study relied on restricted-access Statistics Canada microdata, made available through the British Columbia Inter-University Research Data Centre and the South Western Ontario Research Data Centre. This study reflects the views of the author and does not reflect the opinions of Statistics Canada.

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Canadian Journal on Aging / La Revue canadienne du vieillissement
  • ISSN: 0714-9808
  • EISSN: 1710-1107
  • URL: /core/journals/canadian-journal-on-aging-la-revue-canadienne-du-vieillissement
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