Abstract This paper identifies and quantifies a previously undocumented transmission channel of Quantitative Easing (QE) policies — the Labor Liability Restructuring (LLR) channel — through which the compression of real interest rates to near-zero levels between 2008 and 2024 transformed senior employment contracts into financial liabilities and generated incentives for large corporations to restructure their older workforces with cheap debt. Between 2008 and 2024, G4 central banks expanded their balance sheets by more than US25 trillion, keeping real rates close to zero for more than a decade. Using a panel of 82 publicly listed parent companies across twelve countries (2005–2024) and exploiting exogenous variation in firm-level QE exposure through pre-crisis debt maturity structures (Almeida et al. , 2012), we estimate that firms in the top quartile of QE exposure increased their probability of implementing early retirement schemes for workers aged 55 and above by approximately 1. 7 percentage points on average — a 19% relative increase over the baseline mean of 8. 7% — with marginal effects rising to 4. 2 p. p. for firms at maximum QE exposure. A calibrated discounted cash flow model using O*NET 2024 v29. 1 wage distributions confirms that under zero real rates the net present value of replacing a 55-year-old senior professional ranges from €145, 000 to €343, 000 on average depending on calibration choices, with our central estimate at €190, 000 after incorporating empirically-grounded age-wage slopes (Lemieux, 2006), full fiscal wedge (OECD Taxing Wages 2024), hiring costs (Manning, 2003), and expected insider attrition. Substantial cross-occupational variation is documented (from approximately €70, 000 for Teaching Assistants to over €600, 000 for Personal Financial Advisors and Chief Executives under our central calibration). Convergent validity against the AI Occupational Exposure index of Felten, Raj wild-cluster bootstrap confidence intervals (Roodman et al. , 2019) confirm significance under conservative inference suitable for the limited number of country clusters (N = 12). Each displaced senior worker generates negative fiscal externalities estimated by static microsimulation calibrated on Spanish administrative data (EPA, MCVL) at €121, 000 to €152, 000 in net present value over ten years (sensitivity range across social discount rates δ ∈ 1%, 5% and re-employment scenarios), representing an implicit transfer from the public sector to corporate shareholders. We argue, while emphasising that the present paper does not test this thesis empirically and that the development is offered in a companion paper (García-Lluis Valencia, 2026b), that the fault lies neither with QE nor with AI per se, but with the obsolescence of an industrial-era labour contract that both developments have merely rendered visible.
Alberto García-Lluis Valencia (Tue,) studied this question.