Retirement of the self-employed in the Netherlands

We investigate retirement decisions of the self-employed in the Netherlands using administrative data focusing on individuals around 65, the state pension age, after which each Dutch resident receives the Old Age State Pension annuity. Since the eligibility age and the magnitude of this state pension are known well in advance, we expect to find no impact on labor supply choices, unless individuals face liquidity constraints. We investigate whether this is the case, by looking at retirement and changes in earnings of the self-employed around age 65. We find a peak in retirement when self-employed reach the state pension age, which is unlikely to be due to liquidity constraints but might be explained by behavioral features.