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Household Consumption at Retirement: A Regression Discontinuity Study on French Data

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  • Moreau, Nicolas

    (Université de la Réunion)

  • Stancanelli, Elena G. F.

    (Paris School of Economics)

Abstract

Earlier literature has investigated the drop in household consumption upon retirement of the head of the household, the so-called "retirement consumption puzzle". Here, we expand on these studies by considering also retirement of the wife, thus distinguishing households in which the wife is a "housewife" from 'dual-earners'. We use a regression discontinuity approach to estimate the effect of each partner's retirement on household consumption. We use for the analysis data drawn from the French Consumer Budget Survey 2001 that collected two-week expenditure diaries. We find a significant and sizable drop in food and clothes expenditure upon retirement of the male partner. However, the drop in food expenditure is not robust to specification checks and it becomes statistically insignificant when dropping from the sample couples in which the wife is a housewife.

Suggested Citation

  • Moreau, Nicolas & Stancanelli, Elena G. F., 2013. "Household Consumption at Retirement: A Regression Discontinuity Study on French Data," IZA Discussion Papers 7709, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp7709
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    Cited by:

    1. Eibich, Peter & Siedler, Thomas, 2020. "Retirement, intergenerational time transfers, and fertility," European Economic Review, Elsevier, vol. 124(C).
    2. Allais, Olivier & Leroy, Pascal & Mink, Julia, 2020. "Changes in food purchases at retirement in France," Food Policy, Elsevier, vol. 90(C).
    3. Heller-Sahlgren, Gabriel, 2017. "Retirement blues," Journal of Health Economics, Elsevier, vol. 54(C), pages 66-78.
    4. Oliwia Komada & Pawel Strzelecki & Joanna Tyrowicz, 2019. "A regression discontinuity evaluation of reducing early retirement eligibility in Poland," International Journal of Manpower, Emerald Group Publishing Limited, vol. 40(2), pages 286-303, February.
    5. Jim Been & Susann Rohwedder & Michael Hurd, 2021. "Households’ joint consumption spending and home production responses to retirement in the US," Review of Economics of the Household, Springer, vol. 19(4), pages 959-985, December.
    6. Paweł Strzelecki & Joanna Tyrowicz, 2015. "Crowding (out) the retirees? RDD application to raising effective retirement age in Poland," Working Papers 2015-10, Faculty of Economic Sciences, University of Warsaw.
    7. Christian Dudel & Julian Schmied, 2019. "Pension adequacy standards: an empirical estimation strategy and results for the United States and Germany," MPIDR Working Papers WP-2019-003, Max Planck Institute for Demographic Research, Rostock, Germany.
    8. Peter Eibich, 2014. "Understanding the Effect of Retirement on Health Using Regression Discontinuity Design," SOEPpapers on Multidisciplinary Panel Data Research 669, DIW Berlin, The German Socio-Economic Panel (SOEP).
    9. Fischer, Björn & Müller, Kai-Uwe, 2020. "Time to care? The effects of retirement on informal care provision," Journal of Health Economics, Elsevier, vol. 73(C).
    10. Kyureghian, Gayaneh & Soler, Louis-Georges, 2016. "Life Cycle Consumption of Food: Evidence from French Data," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 236785, Agricultural and Applied Economics Association.
    11. Ioannis Laliotis & Mujaheed Shaikh & Charitini Stavropoulou & Dimitrios Kourouklis, 2019. "Retirement and Household Expenditure in Turbulent Times," GreeSE – Hellenic Observatory Papers on Greece and Southeast Europe 137, Hellenic Observatory, LSE.
    12. Julia Mink, 2021. "The effects of major life events and exposure to adverse environmental conditions on health and health-related outcomes [Les effets d'événements majeurs de la vie et de l'exposition à des condition," SciencePo Working papers tel-03575191, HAL.
    13. Eibich, Peter, 2015. "Understanding the effect of retirement on health: Mechanisms and heterogeneity," Journal of Health Economics, Elsevier, vol. 43(C), pages 1-12.
    14. Georganas, Sotiris & Laliotis, Ioannis & Velias, Alina, 2022. "The best is yet to come: The impact of retirement on prosocial behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 196(C), pages 589-615.
    15. Patrick Moran & Martin Orquote Connell & Cormac Orquote Dea & Francesca Parodi, 2021. "Heterogeneity in Household Spending and Well-being around Retirement," Working Papers wp427, University of Michigan, Michigan Retirement Research Center.
    16. Ioannis Laliotis & Mujaheed Shaikh & Charitini Stavropoulou & Dimitrios Kourouklis, 2023. "Retirement and Household Expenditure in Turbulent Times," Journal of Family and Economic Issues, Springer, vol. 44(4), pages 968-989, December.
    17. Kyureghian, Gayaneh & Soler, Louis-Georges, 2017. "Life Cycle Consumption Of Food At Home: Facts From French Purchase Data," 2017 International Congress, August 28-September 1, 2017, Parma, Italy 260920, European Association of Agricultural Economists.
    18. Paweł Strzelecki & Joanna Tyrowicz, 2015. "Crowding (out) the retirees? RDD application to raising effective retirement age in Poland," Working Papers 2015-10, Faculty of Economic Sciences, University of Warsaw.
    19. Li, Hongbin & Shi, Xinzheng & Wu, Binzhen, 2016. "The retirement consumption puzzle revisited: Evidence from the mandatory retirement policy in China," Journal of Comparative Economics, Elsevier, vol. 44(3), pages 623-637.
    20. Julia Mink, 2021. "The effects of major life events and exposure to adverse environmental conditions on health and health-related outcomes [Les effets d'événements majeurs de la vie et de l'exposition à des condition," SciencePo Working papers Main tel-03575191, HAL.
    21. Christian Dudel & Julian Schmied, 2023. "Pension benchmarks: empirical estimation and results for the United States and Germany," Fiscal Studies, John Wiley & Sons, vol. 44(2), pages 171-188, June.
    22. Kyureghian, G. & Soler, L.-G., 2018. "Life-Cycle Consumption of Food at Home in France: Empirical Evidence from Food Expenditures and Home Production," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277548, International Association of Agricultural Economists.

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    More about this item

    Keywords

    consumption; ageing; retirement; regression discontinuity;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General

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