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IFS Working Papers
May 2002 W02/09
Article
Choice of pension scheme and job mobility in Britain
Type: IFS Working Papers
ISSN: 1742-0415
Volume, issue, pages: 42 pages
JEL classification: H55 J32 J63
Keywords: Pensions, job tenure, labour mobility

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This paper examines the choice of pension scheme and job mobility in Britain. Workers in Britain can choose to belong wholly to the social security (public pension) programme, or to a company-provided plan (occupational pension), or to purchase their own individual pension. We use household panel data for the 1990s to show that individuals that subsequently move job select pension arrangements that a priori impose lower costs on job mobility. A feature of the British policy ‘experiment’, and of the data, is that we can differentiate between choice of actual pension arrangement by the individual and what pension arrangements were offered to that individual. This permits us to test indirectly whether the observed relationship arises from employer selection or from pension scheme design.

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