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21 Nov 16

Pension Insecurity and Wellbeing in Europe.

Old age,
Economic Insecurity

Reference: OLIVERA Javier, PONOMARENKO Valentina. Pension Insecurity and Wellbeing in Europe. Journal of Social Policy, 2017, vol. 46, n°3, pp. 517-542.

Online First: 17/11/2016

DOI: 10.1017/S0047279416000787

Authors: OLIVERA Javier, PONOMARENKO Valentina.

Abstract: This paper studies pension insecurity in a sample of non-retired individuals aged 50 years or older from 18 European countries. We capture pension insecurity with the subjective expectations on the probability that the government will reduce the pensions of the individual before retirement or will increase the statutory retirement age. We argue that changes in economic conditions and policy affect the formation of such probabilities, and through this, subjective wellbeing. In particular, we study the effects of pension insecurity on subjective wellbeing with pooled linear models, regressions per quintiles and instrumental variables. We find a statistically significant, stable and negative association between pension insecurity and subjective wellbeing. Our findings reveal that the individuals who are more affected by pension insecurity are those who are further away from their retirement, have lower income, assess their life survival as low, have higher cognitive abilities and do not expect private pension payments.