 Why are older men working more? The role of social securityZhixiu Yu Journal of Public Economics, 2024, vol. 231, issue C Abstract: This paper investigates the role of Social Security reforms in explaining the increase in labor supply of older men across cohorts and evaluates the labor response by health status. I develop and estimate a rich dynamic life-cycle model of labor supply, savings, and Social Security application that captures the key structure of Social Security retirement benefits, disability insurance, and pension systems, while accounting for uncertainties in health, survival, wages, and medical expenditures. The model matches well the observed life-cycle profiles of employment, hours per worker, and savings for men in the 1930s cohort from the Panel Study of Income Dynamics. I find that Social Security reforms account for over 77% of the observed rises in employment and hours worked by the 1950s cohort, with the retirement earnings test reforms being the most important. The labor response is smaller for unhealthy individuals due to the work disincentives provided by disability benefits. Keywords: Social security reform; Retirement; Labor force participation; Health; Older workers (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:pubeco:v:231:y:2024:i:c:s0047272724000070 DOI: 10.1016/j.jpubeco.2024.105071 Access Statistics for this article Journal of Public Economics is currently edited by R. Boadway and J. Poterba More articles in Journal of Public Economics from Elsevier |
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