Retirement Age, Length of Career and Amount of Pension: A Complex Link in the French Pension System

The 1983 and 2003 French pension reforms have created a complex framework, in which the number of contribution years impacts the minimal retirement age and the reference age that determines pension penalty or bonus. We illustrate the consequences of this framework both on typical career path and using the DESTINIE microsimulation model, and we show that it results in an implicit redistribution among workers, favoring those who start their career at an age which allows them to reach the required number of contribution years exactly at the minimal retirement age. Besides, the increase in pension following a one-year postponement of the retirement age yields different returns among workers. It is larger for those who are still working compared to those who are not (+5.2% vs. +4.3% for workers born in 1955-1964), but it also varies according to wage level, sector, or the situation of people with several pension schemes.