The Impact of Social Security on Pension Claiming and Retirement: Active vs. Passive Decisions

Rafael Lalive, Arvind Magesan and Stefan Staubli

No 13537, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We exploit a unique Swiss reform to identify the importance of passivity, claiming social security benefits at the Full Retirement Age (FRA). Sharp discontinuities generated by the reform reveal that raising the FRA while imposing small early claiming penalties significantly delays pension claiming and retirement, but imposing large penalties and holding the FRA fixed does not. The nature of the reform allows us to identify that between 47 and 69% of individuals are passive, while imposing additional structure point identifies the fraction at 67%. An original survey of Swiss pensioners reveals that reference-dependent preferences is the main source of passivity.

Keywords: full retirement age; social security; regression discontinuity design; reference dependence (search for similar items in EconPapers)
JEL-codes: H55 J21 J26 (search for similar items in EconPapers)
Pages: 71 pages
Date: 2020-07
New Economics Papers: this item is included in nep-age and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published - revised version published in: American Economic Journal: Economic Policy, 2023, 15 (3), 115-50

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Related works:
Working Paper: The Impact of Social Security on Pension Claiming and Retirement: Active vs. Passive Decisions (2020)
Working Paper: The Impact of Social Security on Pension Claiming and Retirement: Active vs. Passive Decisions (2020)
Working Paper: The Impact of Social Security on Pension Claiming and Retirement: Active vs. Passive Decisions (2020)
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