Advanced Search
MyIDEAS: Login to save this paper or follow this series

Maintaining One's Living Standard at Old Age: What Does that Mean? Evidence Using Panel Data from Germany

Contents:

Author Info

  • Christian Dudel
  • Notburga Ott
  • Martin Werding

Abstract

How much retirement income is needed in order to maintain one’s living standard at old age? As it is difficult to find a firm basis for an empirical treatment of this question, we employ a novel approach to assessing an adequate replacement rate vis-à-vis income in the pre-retirement period. We subject indications regarding satisfaction with current income as collected in the German Socio-Economic Panel (GSOEP) to longitudinal analyses, using linear fixed-effects models and fixed-effects ordered logit models as our main analytical tools. We obtain a required net replacement rate of about 87% for the year of entry into retirement as a rather robust result, while replacement rates keeping the living standard unchanged may slightly decline over the retirement period.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2013/wp-cesifo-2013-04/cesifo1_wp4223.pdf
Download Restriction: no

Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 4223.

as in new window
Length:
Date of creation: 2013
Date of revision:
Handle: RePEc:ces:ceswps:_4223

Contact details of provider:
Postal: Poschingerstrasse 5, 81679 Munich
Phone: +49 (89) 9224-0
Fax: +49 (89) 985369
Email:
Web page: http://www.cesifo.de
More information through EDIRC

Related research

Keywords: retirement; living standard; replacement rate; pensions; saving; satisfaction;

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Geishecker, Ingo & Riedl, Maximilian, 2012. "Ordered response models and non-random personality traits: Monte Carlo simulations and a practical guide," Center for European, Governance and Economic Development Research Discussion Papers, University of Goettingen, Department of Economics 116, University of Goettingen, Department of Economics.
  2. Koulovatianos, Christos & Schroder, Carsten & Schmidt, Ulrich, 2005. "On the income dependence of equivalence scales," Journal of Public Economics, Elsevier, Elsevier, vol. 89(5-6), pages 967-996, June.
  3. Bruno S. Frey, 2008. "Happiness: A Revolution in Economics," MIT Press Books, The MIT Press, The MIT Press, edition 1, volume 1, number 0262062771, December.
  4. Binswanger, Johannes & Schunk, Daniel, 2012. "What is an adequate standard of living during Retirement?," Journal of Pension Economics and Finance, Cambridge University Press, Cambridge University Press, vol. 11(02), pages 203-222, April.
  5. Kapteyn, Arie, 1994. "The Measurement of Household Cost Functions: Revealed Preference versus Subjective Measures," Journal of Population Economics, Springer, Springer, vol. 7(4), pages 333-50, November.
  6. Das, J.W.M. & Soest, A.H.O. van, 1996. "A panel data model for subjective information on household income growth," Open Access publications from Tilburg University, Tilburg University urn:nbn:nl:ui:12-121740, Tilburg University.
  7. repec:got:cegedp:116 is not listed on IDEAS
  8. Deaton, Angus S & Muellbauer, John, 1986. "On Measuring Child Costs: With Applications to Poor Countries," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 94(4), pages 720-44, August.
  9. Baetschmann, Gregori & Staub, Kevin E. & Winkelmann, Rainer, 2011. "Consistent Estimation of the Fixed Effects Ordered Logit Model," IZA Discussion Papers 5443, Institute for the Study of Labor (IZA).
  10. Merz, Joachim & Faik, Jürgen, 1994. "Equivalence Scales Based on Revealed Preference Consumption Expenditure Microdata - The Case of West Germany," MPRA Paper 16297, University Library of Munich, Germany.
  11. Lancaster, Tony, 2000. "The incidental parameter problem since 1948," Journal of Econometrics, Elsevier, Elsevier, vol. 95(2), pages 391-413, April.
  12. Bellemare, C. & Melenberg, B. & Soest, A.H.O. van, 2002. "Semi-parametric Models for Satisfaction with Income," Discussion Paper, Tilburg University, Center for Economic Research 2002-87, Tilburg University, Center for Economic Research.
  13. Karsten Kohn & Martin Missong, 2003. "Estimation of Quadratic Expenditure Systems Using German Household Budget Data," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 223(4), pages 422-448, July.
  14. Charlier, Erwin, 2002. "Equivalence Scales in an Intertemporal Setting with an Application to the Former West Germany," Review of Income and Wealth, International Association for Research in Income and Wealth, International Association for Research in Income and Wealth, vol. 48(1), pages 99-126, March.
  15. Robert Fenge & Silke Uebelmesser & Martin Werding, 2006. "On the Optimal Timing of Implicit Social Security Taxes Over the Life Cycle," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, Mohr Siebeck, Tübingen, vol. 62(1), pages 68-107, March.
  16. Kapteyn, A.J., 1994. "The measurement of household cost functions: Revealed preference versus subjective measures," Discussion Paper, Tilburg University, Center for Economic Research 1994-3, Tilburg University, Center for Economic Research.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ces:ceswps:_4223. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julio Saavedra).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.