A handful of studies show that the arrival of grandchildren reduces grandparents’ working hours and increases grandparents’ likelihood of leaving the labor market. These studies, however, are generally based in countries with weaker childcare support systems than Denmark. It is important to understand whether the decision to retire after becoming a grandparent reflects grandparents’ preferences or parents’ need for affordable and reliable childcare. In this sub-project, we investigate the impact of becoming a grandparent on retirement decisions in Denmark, which has one of the most generous social safety nets in the world, combined with 52 weeks of parental leave, generous cash payments to families with children, heavily subsidized child care, and free and universal health care. If becoming a grandparent changes an individual’s preferences for work, we would expect to find similar effects on retirement decisions in Denmark. We use administrative data and implement several identification strategies to identify the effects.
01.01.2020 - 31.12.2021 / Life-Cycle Decisions
In Cooperation with MEA
Grandkids and retirement