%0 Report
        %A Gomes, Pedro Maia
%A Wellschmied, Felix
        %T Public-Sector Compensation over the Life Cycle
        %D 2020
        %8 2020 Mar
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 13042
        %U https://www.iza.org/publications/dp13042
        %X The size of the public sector in terms of employment and compensation has a strong life-cycle dimension. We establish a quantitative partial-equilibrium life-cycle model with incomplete markets, private and public sectors, and risk-averse workers, and use it to (i) calculate three dimensions of public-sector compensation: wage, pension, and job-security premia, and (ii) quantify the effects of harmonizing the compensation in the two sectors. We find that the job-security and pension's premia are important forms of compensation to public-sector workers. Harmonizing the characteristics of public employment with those of the private sector would lower the unemployment rate and reduce government costs.
        %K public-sector employment
%K public-sector wages
%K life cycle
%K unemployment
%K retirement
%K pensions
%K job security