The effect of immigration in the retirement age reforms: learning from a numerical example

Abstract

This article examines the role played by the low-skilled immigrant labour force in countries aiming to reform their public pension systems by postponing the pensionable age. With an overlapping-generations model in continuous time and a fully redistributive pension system, the results of this article suggest that immigration could imply a delay in the pensionable retirement age. Further, we find that the preference for a delay in retirement age increases with the labour productivity of both immigrants and native population.