Do retirement windfalls create entrepreneurs? Evidence from Türkiye’s 2023 retirement age reform

Abstract Little is known about whether a sudden pension windfall turns mid-career workers into entrepreneurs. This paper studies Türkiye's 2023 reform that removed the minimum retirement age for workers first insured before September 1999. Within a single year, the reform gave about 1.76 million workers a lifetime pension and, for employees, a statutory severance entitlement, and it allowed them to keep working. I combine monthly social security bulletins, a new province panel of active taxpayers by tax regime and official firm registration statistics for 70 provinces, and I exploit regional variation in the share of workers who became eligible. Per excess retiree, the number of pensioners who kept working in registered jobs rose by 0.30 to 0.52. Business creation did not respond. New firm registrations, net firm formation, corporate taxpayers, withholding-tax agents and the total number of individual business taxpayers show no detectable change, and the upper confidence bound for new firms is about one firm per 200 retirees. The stock of individual businesses tilted towards the income-tax-exempt micro regime, but this shift does not survive corrections for multiple testing. Effects do not grow where credit is scarce, and the reform did not raise job placements of young workers or change average earnings. A large liquidity windfall at retirement sustained registered wage work but created no measurable job-creating entrepreneurship, which matters for policies that count on pension and severance wealth to generate decent work. JEL Classification J26; L26; H55; J32; O17