Changing Pension Landscape: Gender Differences in Responses to Retirement Reform

Joint with: Tamar Ramot-Nyska

Abstract: We study the labor supply and retirement income effects of the transition from Defined Benefit (DB) to Defined Contribution (DC) pension systems using administrative data from a large-scale reform. Exploiting gender differences in financial fragility arising from labor market histories and longer life expectancy, we show that women, who face lower expected retirement income under DC—extended their working lives by more than one year on average. This additional labor supply partially offset income losses but left persistent gender gaps in replacement rates. The results highlight important distributional consequences of DC pension systems and have direct implications for the design of pension and Social Security–type schemes.

Homepage: https://www.boi.org.il/en/economic-roles/research-and-publications/our-researchers/haran-rosen-maya/