Female labor supply and rural pension eligibility in Brazil

In 1991, Brazil expanded its rural retirement pension to cover millions of previously uncovered women, conditional on work requirements. We use a difference-in-differences approach to show that this expansion drastically increased married women’s employment by nine percentage points, or 26 percent. This increase in labor force participation occurred among women who were immediately age-eligible, and among younger cohorts that would be eligible in the future. These results illuminate the capacity of workers to respond to financial incentives for labor participation, and the extent to which younger workers might be forward-looking as they respond to retirement incentives.