Ylenia Brilli, Elena Bassoli

Wednesday, 13 March - 3 PM - Seminar Room (DEM)


This paper assesses how a recent and unexpected Italian pension reform changed the incentive to early retirement for women.

The analysis uses rich Italian administrative data and it is based on a differences-in-discontinuities design. Identification exploits the facts that (i) women with just above 35 years of contributions are eligible for early retirement; (ii) women born in 1952 are the first cohort affected by the retirement age increase, while women born in 1951 are unaffected. The results indicate that treated women above 35 years of contribution, for whom age increased unexpectedly from age 60 to 64, retire early by 8 months compared to the unaffected cohort (i.e. at age 61 vs. 61.8 months). As this option entails a penalty in the annuity, we also evaluate the reform's effect on women's pension amount. The findings indicate a reduction in the benefit of about 15% compared to the unaffected group. This paper shows how tightening pension rules could push close-to-retirement women to exit the labour market earlier at the price of smaller annuities.