Sona Badalyan

I am an applied microeconomist, mainly interested in the intersection of social safety net programs (e.g., retirement and unemployment) with labor markets and with personnel practices employed by firms, and their implications for inequalities.

I am a PhD candidate in Economics at the CERGE-EI and a part-time research associate at the Institute for Employment Research (IAB). During my PhD years, I made research visits to the University of Chicago and the IAB. I also did a PhD internship at the Dutch National Bank.

Next talks: EEA (Bordeaux, Aug 25-28); NU-DE Workshop on Applied Microeconomics (Nuremberg, Oct 1-2); WZB Workshop on the economics of ageing and pensions (Berlin, Nov 20-21)

CV: here

E-mail: sona.badalyan@cerge-ei.cz ; sona.badalyan2@iab.de

Research

I. Retirement Reforms: Employment Decisions, Firm Responses, and Workplace Interactions

Retirement Age Reforms and Worker Substitutability: Implications for Employment of Older Workers

Abstract: This paper studies how labor demand factors—specifically worker substitutability and job-specific skills—shape employment responses to a rise in the early retirement age. Using a regression discontinuity design, I exploit a 1999 German reform that eliminated the option for women to retire at age 60. Before the reform, older workers could exit voluntarily, thereby imposing turnover costs on firms. Afterward, firms were better able to retain less substitutable, more difficult-to-replace workers for whom turnover costs are higher. At the same time, the loss of early pension eligibility reduced workers’ outside options, allowing firms to offer lower wages. The reform thus improved the retention of less substitutable workers, lowering both turnover costs and wages

[CERGE-EI Working Paper No.794]

[Programming files]

Peer Effects in Old-age Employment among Women

Abstract: Institutional differences alone cannot fully explain the variation in labor supply at older ages, highlighting the potential role of social norms and behavioral spillovers. This paper studies peer effects in old-age employment among women, asking whether exposure to the labor market behavior of older colleagues influences individual employment decisions later in life. Leveraging rich German social security data, I define peer groups based on detailed occupation and establishment identifiers to capture meaningful workplace interactions. Identification comes from a pension reform that raised the early retirement age for women born after 1951 by at least three years. The key variation arises from coworkers’ exposure to peer women just above or below the reform cutoff. I find that women are significantly more likely to remain employed at older ages when their peers decide to do so. The results suggest that institutional changes can propagate through workplace social networks, amplifying their effects beyond the directly treated individuals.

[Draft coming soon]

Crowded Career Ladders? Firm Responses to Raising Women's Retirement Age

Abstract: Coworkers' careers are interdependent. This paper studies how the extension of the working lives of older workers affects the advancement of their younger colleagues. I exploit a 1999 German reform that raised the early retirement age for women, using the universe of German social security records. These data allow me to track workers by occupation and establishment, identifying precise coworker groups. The reform delayed older women’s labor force exit and reduced promotion and hiring of younger coworkers, particularly middle-aged women. These effects are stronger where coworkers are more substitutable due to occupational segregation and career stage proximity. The results highlight internal labor market frictions and show that even with a long planning horizon, firms face adjustment costs in response to the aging of the workforce.

[Latest version]

Awards: 1st place: Young Economists Seminar (Croatian National Bank, 2024)

2nd place: Young Economist of the Year in the Czech Republic (Czech Economic Society, 2024)

II. Unemployment, Hiring, and Labor Market Inequality

Households in Crisis: From Pink Slips to Career Shifts Across Generations (with C. Biesenbeek & M. Mastrogiacomo)

[Latest version, data coding is in progress]

Disclosure Discrimination: An Experiment Focusing on Communication in the Hiring Process (with D.Korlyakova & R.Rehák)

[CERGE-EI Working Paper No. 743]