Do notional defined contribution schemes prolong working life? Evidence from the 1994 Swedish pension reform

Haodong Qi, Lund University
Jonas Helgertz, Lund University
Tommy Bengtsson, Lund University

This paper investigates whether the prolonged working life during recent decade in Sweden was a result of the 1994 pension reform which phased in the Notional Defined Contribution (NDC) Scheme. While NDC scheme effectively prolonged older men's working life, it had very moderate effect on women's retirement age, or even negative impact among those women who had no university or higher education and who worked in a low-skilled occupation. These findings imply that a solitary pension reform may not necessarily increase the average effective retirement age, rather other measures might be important.