Does the retirement consumption puzzle differ across the distribution?
Jonathan Fisher and
Joseph Marchand ()
The Journal of Economic Inequality, 2014, vol. 12, issue 2, 279-296
Previous research has repeatedly found a puzzling one-time drop in the mean and median of consumption at retirement, contrary to the predictions of the life-cycle hypothesis. However, very little is known as to whether these effects vary across the consumption distribution. This study expands upon the previous work by examining changes in the consumption distribution between the non-retired and the retired using quantile regression techniques on pseudo-cohorts from the cross-sectional data of the 1990–2007 Consumer Expenditure Survey. The results indicate that there are insignificant changes between these groups at the lower end of the consumption distribution, while there are significant decreases at the higher end of this distribution. In addition, these changes in the distribution are gradually larger in magnitude when moving from the lower end to the higher end, which is found using several different measures of consumption. Work-related expenditures are instead shown to decrease uniformly across the consumption distribution. This evidence reveals that there is a progressive distributional component to the retirement consumption puzzle. Copyright Springer Science+Business Media New York 2014
Keywords: Retirement; Life-cycle model; Household consumption; J26; D91; D12 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (8) Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to subscribers.
Working Paper: Does the Retirement Consumption Puzzle Differ Across the Distribution? (2013)
Working Paper: Does the Retirement Consumption Puzzle Differ Across the Distribution? (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:kap:jecinq:v:12:y:2014:i:2:p:279-296
Ordering information: This journal article can be ordered from
http://www.springer. ... th/journal/10888/PS2
Access Statistics for this article
The Journal of Economic Inequality is currently edited by Stephen Jenkins
More articles in The Journal of Economic Inequality from Springer, Society for the Study of Economic Inequality Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla ().