Retirement and Consumption in a Life Cycle Model

David Blau ()

Journal of Labor Economics, 2008, vol. 26, pages 35-71

Abstract: Consumption expenditure declines sharply at the time of retirement for many households, but the majority maintain a smooth consumption path. A simple life cycle model with uncertainty about the time of retirement can account for this pattern. A richer version of the model is calibrated to data from the Health and Retirement Study (HRS). The median change in consumption expenditure at retirement generated by the model is zero, while the mean is negative, matching the HRS data. However, the magnitude of the drop in consumption among households that experience a decline is too small in the model compared to the data.

Date: 2008
View citations in EconPapers

Downloads: (external link)
http://www.journals.uchicago.edu/cgi-bin/resolve?id=doi:10.1086/522066 (text/html)

Related works:
Working Paper: Retirement and Consumption in a Life Cycle Model (2007)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:ucp:jlabec:v:26:y:2008:p:35-71

Ordering information: This journal article can be ordered from
http://www.journals.uchicago.edu/JOLE/order1.html

Access Statistics for this article

Journal of Labor Economics is edited by Derek A. Neal

More articles in Journal of Labor Economics from University of Chicago Press
Address: The University of Chicago Press, Journals Division, P.O. Box 37005 Chicago, IL 60637
Series data maintained by Christopher F. Baum ().