Social Security's Delayed Retirement Credit and the Labor Supply of Older Men

Pingle, Jonathan F.

doi:10.17016/feds.2006.37

Cited by 16 publications

(23 citation statements)

References 22 publications

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“…Making a projection of the effect of the rising DRC and elimination of the RET is more difficult. Pingle (2006) suggests that the DRC increase led to a 5-point increase in participation at ages 65 to 69 while the findings of Friedberg and Webb (2009) might suggest a further 1-to 2-point increase from the elimination of the RET. Together these would account for roughly half the increase in participation since 1995 in the 65 to 69 age group, and the participation rate of this group being roughly half that of men age 60 to 64, this might be seen as equivalent to one-sixth of the overall increase in the retirement age, or 4.3 months.…”

Section: Discussionmentioning

confidence: 91%

“…An increase in the DRC may encourage individuals to delay benefit claim without changing their retirement decision or could encourage individuals to delay both retirement and claiming if they tend to treat these decisions as linked (though they need not be). Pingle (2006) estimates the effect of the DRC on employment in a model that includes age and year fixed effects and a polynomial in birth year, using the step increases in the DRC for identification. He finds that each one percentage point increase in the DRC is associated with a roughly one percentage point increase in the employment rate of men ages 65 to 69.…”

Section: Social Security Reformsmentioning

confidence: 99%

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Working Longer in the U.S.: Trends and Explanations

Coile

2018

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This paper was prepared as part of the NBER International Social Security (ISS) project. The author thanks the members of the ISS team for valuable suggestions and Hero Ashman and Clio Flikkema for excellent research assistance. The views expressed herein are those of the author and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

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Section: Discussionmentioning

confidence: 91%

Section: Social Security Reformsmentioning

confidence: 99%

Working Longer in the U.S.: Trends and Explanations

Coile

2018

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“…(Social Security benefits claiming is independent from retirement decisions, but some individuals may want to work longer if they choose to delay their benefit claiming.) Pingle (2006) accounts for more than one-quarter of the continued increase in older women's employment taking place since then.…”

Section: Changes To Ssdi Social Security Retirement and Other Sociamentioning

confidence: 99%

The Decline in the U.S. Labor Force Participation Rate

2018

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After peaking around the year 2000, the Labor Force Participation Rate (LFPR) of Americans declined substantially, falling faster after the financial crisis of 2007. Since 2015, the LFPR has remained at its lowest in four decades. In this paper, we produce a comprehensive review of the literature investigating the causes of the recent decline in LFPR. We include works from the academic literature as well as gray literature from research institutes and labor market experts, and published and unpublished studies. The literature reviewed signals multiple causes behind this decline. The research on the extent to which the Great Recession had caused the decline establishes that most of it cannot be attributed to cyclical factors. Additionally, the literature examines the relative importance of trend factors, such as long-running demographic patterns, which explain at least part of the decline. The review includes articles that aim to quantify the impact of one or more factors through statistical or econometric analysis or economic modeling. Demographic trends, such as the aging of the Baby Boom Generation, explain a large portion of the decline. The rest of the decline can be attributed to factors that affect the participation rates of specific subpopulations, such as technological innovations and trade, as well as to changes in social programs, such as Social Security Disability Insurance. Some subpopulation trends are clear, but their ultimate causes are not fully understood, as is the case for female and youth LFPRs. We list these factors and point to important areas for future research. Authors' acknowledgementsWe acknowledge the support from the Michigan Retirement Research Center, which made this research possible. We thank Arie Kapteyn for useful comments. Preface After peaking around the year 2000, the Civilian Labor Force Participation Rate of Americans declined substantially. The drop became more pronounced following the financial crisis of 2007, continuing until 2015. The result is that the Labor Force Participation Rate (LFPR) is currently at its lowest level in the last four decades. Understanding the causes of this decline is fundamental in assessing the future of the American workforce and the long-term implications for retirees and in determining policy actions needed. To guide that research, our literature review establishes what is known and identifies the remaining gaps.There has not been a complete review of the literature of these causes, though there has been some partial investigation. For this study, we reviewed, systematically and comprehensively, the literature on the causes of the LFPR decline since 2000. The review includes all the studies found through systematic searches in databases, although the narrative often uses the most current and rigorous study to describe an aspect of the evidence while referring to prior or auxiliary studies as appropriate. This paper begins with an introduction to the subject and a chapter describing the search procedures. It then follows with three chapters d...

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“…The affected cohorts would increase their labor supply by about half as much as the increase in the FRA, which means two months increase in FRA will result one month increase in retirement age. Pingle(2006) found that each percentage point increase in DRC led to a percentage point increase in the employment rate of men aged 65-70.…”

Section: Related Literaturementioning

confidence: 99%

“…Most studies have found that the reforms to the Social Security Old Age system have contributed to the increases in the Labor Force Participation Rate (LFPR) among the elderly since the mid-1990s (Pingle(2006), Blau and Goodstein (2007) (2010), Schirle (2008), DiCecio et al(2008)); and individuals' retirement decisions will further affect their health insurance coverage, and therefore the expected Medicare Expenditures. Additionally, aggregate statistics (See Figure 1) show that the Labor Force Participation Rate of those 65 years & over has increased during the 2002 to 2013 period, from 13.2% to 19%.…”

Section: Introductionmentioning

confidence: 99%

Medicare Expenditures, Social Security Reform, and the Labor Force Participation of Older Americans

Deng

Benı́tez-Silva

2015

SSRN Journal

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The changes to the Social Security Old Age benefits system introduced in the last decade, which will continue later this decade, have impacted individuals' labor supply and retirement decisions, and therefore their health insurance coverage. This paper provides an empirical analysis of the effects of the changes in the OA system, resulting from the 1983 Amendments, on Medicare costs. Using data from the Medicare Current Beneficiary Survey (MCBS), we empirically analyze the Medicare expenditures of individuals around retirement age as a function of their health insurance coverage and labor market attachment. Our results show a significant effect of employment measures as well as insurance coverage types, suggesting a sizable effect of employment and insurance on Medicare expenditures as well as on total health expenditures and on out-of-pocket health expenditures. Our findings allow us to compute the total savings to the Medicare system resulting from individuals' working while receiving health insurance coverage at older ages, and we estimate savings of 2.89 billion dollars a year, as well as another 333.67 million per year resulting from the delayed in enrollment into the Medicare system, given that some individuals do not enrolled in Medicare when first available, and this is more common among those who work and have insurance coverage. These results suggest that any future reform to the social insurance system will have to account for the effect on Medicare costs of policies that likely lead to increases in employment and employer provided health insurance coverage among populations eligible for Medicare.

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Social Security's Delayed Retirement Credit and the Labor Supply of Older Men

Cited by 16 publications

References 22 publications

Working Longer in the U.S.: Trends and Explanations

Working Longer in the U.S.: Trends and Explanations

The Decline in the U.S. Labor Force Participation Rate

Medicare Expenditures, Social Security Reform, and the Labor Force Participation of Older Americans

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