^aCenter for Comparative Welfare Studies, Aalborg Univesity, Fibigerstrade 1, Aalborg 9220, Denmark. E-mail: perh@socsci.aau.dk

Abstract

Denmark is a low exit country in EU-25. As such, the Danish experience contradicts most wisdom in mainstream research on the causes of early exit/retirement. The Danish labour market is one of the most brutal vis-à-vis older workers in Europe, while the Danish early retirement schemes are among the most generous in Europe. For these reasons one should expect Denmark to be a high exit country. The contrary is true. With this background, it is argued that cultural and social–psychological factors play a far stronger role in shaping retirement patterns than we tend normally to assume. Accordingly, in recent years Denmark has employed cultural steering based on the voluntary participation of firms and other social partners in attempts to raise further the employment rate of older workers. Cultural steering has been supplemented by the introduction of "positive" incentives, that is, individuals and municipalities are rewarded economically if retirement is postponed.