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Social Security and elderly labor supply: Evidence from the Health and Retirement Study

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  • Vere, James P.

Abstract

This study uses panel data from the Health and Retirement Study (HRS) to estimate the effects of Social Security income on elderly labor supply in the 1990s and early 2000s. The identification strategy takes advantage of the 1977 amendments to the Social Security Act, which led to a large, unanticipated reduction in Social Security benefits for those born after January 1, 1917. Despite the advanced age of the notch cohorts, there is a significant, negative and surprisingly elastic relationship between Social Security income and hours of work. This suggests that currently proposed reductions in benefits would induce Social Security recipients to work more hours in retirement, even through their 70s and early 80s.

Suggested Citation

  • Vere, James P., 2011. "Social Security and elderly labor supply: Evidence from the Health and Retirement Study," Labour Economics, Elsevier, vol. 18(5), pages 676-686, October.
    • Handle: RePEc:eee:labeco:v:18:y:2011:i:5:p:676-686
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    2. Giles, John T. & Wang, Dewen & Cai, Wei, 2011. "The Labor Supply and Retirement Behavior of China's Older Workers and Elderly in Comparative Perspective," IZA Discussion Papers 6088, Institute of Labor Economics (IZA).
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    4. Shu, Lei, 2017. "Essays on retirement income provision," Other publications TiSEM e5dd8c4e-03bf-4ec9-9651-b, Tilburg University, School of Economics and Management.
    5. Shu, Lei, 2018. "The effect of the New Rural Social Pension Insurance program on the retirement and labor supply decision in China," The Journal of the Economics of Ageing, Elsevier, vol. 12(C), pages 135-150.
    6. J. Wilson Mixon Jr. & E. Frank Stephenson, 2016. "Young and Out of Work: An Analysis of Teenage Summer Employment, 1972–2012," Cato Journal, Cato Journal, Cato Institute, vol. 36(1), pages 89-99, Winter.
    7. Lingxiao Zhao & Gregory Burge, 2017. "Housing Wealth, Property Taxes, and Labor Supply among the Elderly," Journal of Labor Economics, University of Chicago Press, vol. 35(1), pages 227-263.
    8. Giles, John & Lei, Xiaoyan & Wang, Gewei & Wang, Yafeng & Zhao, Yaohui, 2023. "One country, two systems: evidence on retirement patterns in China," Journal of Pension Economics and Finance, Cambridge University Press, vol. 22(2), pages 188-210, April.
    9. Zuojuan Li & Guofeng Li & Ke Zhang & Jingxin Zhu, 2022. "Do Social Pension and Family Support Affect Farmers’ Land Transfer? Evidence from China," Land, MDPI, vol. 11(4), pages 1-14, March.

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