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Wage Declines among Older Men

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Author Info
Johnson, Richard W
Neumark, David

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Abstract

We examine the evidence on whether real wages decline with age among older men. While the general human capital model of wage growth over the life cycle predicts that wages will fall as workers approach the end of their career, alternative models of wage growth do not predict these wage declines. We find that in longitudinal estimates of age-wage profiles wage declines only set in for workers in their 60s. Furthermore, these longitudinal declines are at least partly due to interactions with the Social Security system. The earnings cap or other effects of Social Security appear to lead some workers to choose jobs and job characteristics associated with lower wages. Copyright 1996 by MIT Press.

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File URL: http://links.jstor.org/sici?sici=0034-6535%28199611%2978%3A4%3C740%3AWDAOM%3E2.0.CO%3B2-Y&origin=bc
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Publisher Info
Article provided by MIT Press in its journal Review of Economics & Statistics.

Volume (Year): 78 (1996)
Issue (Month): 4 (November)
Pages: 740-48
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Handle: RePEc:tpr:restat:v:78:y:1996:i:4:p:740-48

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Web page: http://mitpress.mit.edu/journals/

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  1. Susan W. Parker, 1999. "Elderly Health and Salaries in the Mexican Labor Market," RES Working Papers 3051, Inter-American Development Bank, Research Department. [Downloadable!]
  2. David Neumark & Elizabeth Powers, 1998. "Welfare for the Elderly: The Effects of SSI on Pre-Retirement Labor Supply," NBER Working Papers 6805, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  3. Steven J. Haider & David S. Loughran, 2003. "How Important Are Wages to the Elderly? Evidence from the New Beneficiary Data System and the Social Security Earnings Test," Working Papers wp049, University of Michigan, Michigan Retirement Research Center. [Downloadable!]
  4. Gudrun Biffl & Joseph E. Isaac, 2005. "Sustaining Employment of Older Workers in an Ageing Society," WIFO Working Papers 256, WIFO. [Downloadable!]
  5. Igor Livshits & James MacGee & Michele Tertilt, 2003. "Consumer bankruptcy: a fresh start," Working Papers 617, Federal Reserve Bank of Minneapolis. [Downloadable!]
    Other versions:
  6. Dhaval Dave & Inas Rashad & Jasmina Spasojevic, 2006. "The Effects of Retirement on Physical and Mental Health Outcomes," NBER Working Papers 12123, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  7. David Neumark, 2001. "Age Discrimination Legislation in the United States," NBER Working Papers 8152, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  8. Gudrun Biffl, 2006. "Age Management – a Coping Strategy for Employers. The Case of the Automotive Industry," WIFO Working Papers 274, WIFO. [Downloadable!]
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