NATIONAL BUREAU OF ECONOMIC RESEARCH
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Health Capacity to Work at Older Ages in Denmark

Paul Bingley, Nabanita Datta Gupta, Peder J. Pedersen

Chapter in NBER book Social Security Programs and Retirement around the World: The Capacity to Work at Older Ages (2017), David A. Wise, editor (p. 85 - 110)
Published in May 2017 by University of Chicago Press
© 2017 by the National Bureau of Economic Research
in NBER Book Series - International Social Security

Longevity is increasing and many people are spending a greater proportion of their lives reliant on pensions to support consumption. In response to this, several countries have mandated delays to age of first entitlement to pension benefits in order to reduce incentives to retire early. However, it is unknown to what extent older individuals have the health capacity to sustain the longer working lives that delayed pension benefits may encourage. We estimate the health capacity to work longer in Denmark by comparing how much older individuals work today with how much those with similar mortality rates worked in the past, and how much younger individuals today with similar self-assessed health work. We find substantial health capacity for longer working lives among those currently aged 55 and above. We also find significant heterogeneity by education and gender. Those with a high school degree have the greatest additional work capacity, women have more additional capacity than men, especially women with a college degree.

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This chapter first appeared as NBER working paper w22018, Health Capacity to Work at Older Ages in Denmark, Paul Bingley, Nabanita Datta Gupta, Peder Pedersen
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