Pension Reform Effects in Times of Technological Change and Shifting Task Composition

Abstract We study heterogeneity in the effects of a pension reform in Germany: the introduction of the old-age pension for the very long-term insured, which lowered the threshold for full pension receipt from age 65 to 63. Using a regression discontinuity design (RDD) and rich administrative pension data, we estimate the effects of the reform on eligible workers who differ in a number of occupational characteristics. Transitions into the new early retirement scheme occurred more frequently from jobs involving mainly manual and routine tasks, which contributed to the changing composition of tasks in the workforce. While the introduction of new technologies, materials and machines in an industry was associated with more workers claiming early retirement, workers affected by frequent PC use and new PC programmes were less likely to use the early retirement scheme.