The School of Economics invites you to an applied seminar by David Rogers (UNSW).

WWII veterans in Australia could access retirement and disability benefits that the rest of the population could not. I use this differential access to examine the labour supply effects of these programs. WWII veterans could access the Service Pension, a pension with similar benefit levels and means tests to the normal Age Pension, but available five years earlier at the age of 60. A large share also accessed a disability pension provided by the Department of Veterans’ Affairs. My primary approach to identification is to use the large differences in World War II service across single year birth cohorts of Australian men uncovered by Cousley et al. (2017).

Results from this approach suggest that WWII service significantly lowered participation, but only over the ages of 60 to 64. A 10 percentage point rise in the share of a cohort that served overseas during WWII is estimated to have lowered participation of the cohort by 2.7 percentage points over these ages. I also compare the retirement expectations of WWII veterans and nonveterans at middle-age. Veterans did expect to retire earlier, but again only over the ages of 60 to 64. The age distribution of these participation effects indicates they were likely caused by the Service Pension earnings test.