Home ownership and early retirement: European experience in the 1990s

Throughout the 1990s the general pattern acrossthe EU member states was of expanding homeownership sectors and of falling labourparticipation rates amongst older workers,particularly men. Using macro-level data, thepaper sets out to explain national differencesin participation rates, taken as a proxymeasure of early retirement. Whereas itindicates the statistical importance of anumber of trends – specifically labour marketconditions and government social policies – thepaper particularly focuses on the possible roleof housing tenure. It presents evidenceconsistent with the proposition that, onceowned outright, home ownership may offer theability to live rent-free and to create apension and thus facilitate early retirement. In acting as a sort of individualised providentfund, it may both give some welfare states adistinctive character as well as contribute tothe early retirement of large numbers of peoplefrom the labour market. The paper explores anumber of methodological and policy issuesarising from the analysis.