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

Aching to Retire? The Rise in the Full Retirement Age and its Impact on the Disability Rolls

Contents:

Author Info

  • Mark Duggan
  • Perry Singleton
  • Jae Song

Abstract

The Social Security Amendments of 1983 reduced the generosity of Social Security retired worker benefits in the U.S. by increasing the program's full retirement age from 65 to 67 and increasing the penalty for claiming benefits at the early retirement age of 62. These changes were phased in gradually, so that individuals born in or before 1937 were unaffected and those born in 1960 or later were fully affected. No corresponding changes were made to the program's disabled worker benefits, and thus the relative generosity of Social Security Disability Insurance (SSDI) benefits increased. In this paper, we investigate the effect of the Amendments on SSDI enrollment by exploiting variation across birth cohorts in the policy-induced reduction in the present value of retired worker benefits. Our findings indicate that the Amendments significantly increased SSDI enrollment since 1983, with an additional 0.6 percent of men and 0.9 percent of women between the ages of 45 and 64 receiving SSDI benefits in 2005 as a result of the changes. Our results further indicate that these effects will continue to increase during the next two decades, as those fully exposed to the reduction in retirement benefit generosity reach their fifties and early sixties.

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.nber.org/papers/w11811.pdf
Download Restriction: no

Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 11811.

as in new window
Length:
Date of creation: Dec 2005
Date of revision:
Publication status: published as Duggan, Mark, Perry Singelton and Jae Song. "Aching to Retire? The Rise in the Full Retirement Age and it's Impact on the Disability Rolls." Journal of Public Economics 91, 7 (August 2007): 1327-50.
Handle: RePEc:nbr:nberwo:11811

Note: AG HE PE
Contact details of provider:
Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Phone: 617-868-3900
Email:
Web page: http://www.nber.org
More information through EDIRC

Related research

Keywords:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

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. Hugo Benitez-Silva & Moshe Buchinsky & Hiu-Man Chan & John Rust & Sofia Sheivasser, 1997. "An Empirical Analysis of the Social Security Disability Application, Appeal, and Award Process," Public Economics, EconWPA 9712001, EconWPA, revised 16 Feb 1998.
  2. Alan L. Gustman & Thomas L. Steinmeier, 2002. "The Social Security Early Entitlement Age in a Structural Model of Retirement and Wealth," NBER Working Papers 9183, National Bureau of Economic Research, Inc.
  3. John Bound & Julie Berry Cullen & Austin Nichols & Lucie Schmidt, 2002. "The Welfare Implications of Increasing Disability Insurance Benefit Generosity," NBER Working Papers 9155, National Bureau of Economic Research, Inc.
  4. Lucie Schmidt & Purvi Sevak, 2004. "AFDC, SSI, and Welfare Reform Aggressiveness: Caseload Reductions versus Caseload Shifting," Journal of Human Resources, University of Wisconsin Press, vol. 39(3).
  5. Dan Black & Kermit Daniel & Seth Sanders, 2002. "The Impact of Economic Conditions on Participation in Disability Programs: Evidence from the Coal Boom and Bust," American Economic Review, American Economic Association, American Economic Association, vol. 92(1), pages 27-50, March.
  6. Mark G. Duggan & Melissa Schettini Kearney, 2007. "The impact of child SSI enrollment on household outcomes," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 26(4), pages 861-886.
  7. Lucie Schmidt & Purvi Sevak, 2000. "AFDC, SSI, and Welfare Reform Aggressiveness: Caseload Reductions vs. Caseload Shifting," Department of Economics Working Papers, Department of Economics, Williams College 2002-03, Department of Economics, Williams College.
  8. Diamond, Peter & Sheshinski, Eytan, 1995. "Economic aspects of optimal disability benefits," Journal of Public Economics, Elsevier, Elsevier, vol. 57(1), pages 1-23, May.
  9. Mark Duggan & Scott A. Imberman, 2009. "Why Are the Disability Rolls Skyrocketing? The Contribution of Population Characteristics, Economic Conditions, and Program Generosity," NBER Chapters, National Bureau of Economic Research, Inc, in: Health at Older Ages: The Causes and Consequences of Declining Disability among the Elderly, pages 337-379 National Bureau of Economic Research, Inc.
  10. Parsons, Donald O, 1991. "The Health and Earnings of Rejected Disability Insurance Applicants: Comment," American Economic Review, American Economic Association, American Economic Association, vol. 81(5), pages 1419-26, December.
  11. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, The MIT Press, edition 2, volume 1, number 0262232588, December.
  12. Bowen Garrett & Sherry Glied, 2000. "Does state AFDC generosity affect child SSI participation?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 19(2), pages 275-295.
  13. Bound, John & Burkhauser, Richard V., 1999. "Economic analysis of transfer programs targeted on people with disabilities," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 51, pages 3417-3528 Elsevier.
  14. John Bound, 1989. "The Health and Earnings of Rejected Disability Insurance Applicants," NBER Working Papers 2816, National Bureau of Economic Research, Inc.
  15. Kreider, Brent, 1999. "Social Security Disability Insurance: Applications, Awards, and Lifetime Income Flows," Staff General Research Papers, Iowa State University, Department of Economics 5188, Iowa State University, Department of Economics.
  16. Jonathan Gruber & Jeffrey D. Kubik, 1994. "Disability Insurance Rejection Rates and the Labor Supply of Older Workers," NBER Working Papers 4941, National Bureau of Economic Research, Inc.
  17. Jonathan Gruber, 2000. "Disability Insurance Benefits and Labor Supply," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 108(6), pages 1162-1183, December.
  18. Bruce D. Meyer, 1988. "Unemployment Insurance And Unemployment Spells," NBER Working Papers 2546, National Bureau of Economic Research, Inc.
  19. David H. Autor & Mark G. Duggan, 2003. "The Rise In The Disability Rolls And The Decline In Unemployment," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 118(1), pages 157-205, February.
  20. Kubik, Jeffrey D., 2003. "Fiscal Federalism and Welfare Policy: The Role of States in the Growth of Child SSI," National Tax Journal, National Tax Association, vol. 56(1), pages 61-79, March.
  21. Bound, John, 1991. "The Health and Earnings of Rejected Disability Insurance Applicants: Reply," American Economic Review, American Economic Association, American Economic Association, vol. 81(5), pages 1427-34, December.
  22. Gruber, Jonathan & Kubik, Jeffrey D., 1997. "Disability insurance rejection rates and the labor supply of older workers," Journal of Public Economics, Elsevier, Elsevier, vol. 64(1), pages 1-23, April.
  23. Parsons, Donald O, 1980. "The Decline in Male Labor Force Participation," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 88(1), pages 117-34, February.
  24. Jonathan Gruber & Jeffrey Kubik, 2002. "Health Insurance Coverage and the Disability Insurance Application Decision," NBER Working Papers 9148, National Bureau of Economic Research, Inc.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Joyce Manchester & Jae Song, 2008. "Have People Delayed Claiming Retirement Benefits? Responses to Changes in Social Security Rules: Working Paper 2008-04," Working Papers, Congressional Budget Office 19575, Congressional Budget Office.
  2. Pierre Koning & Daniel van Vuuren, 2010. "Disability insurance and unemployment insurance as substitute pathways," Applied Economics, Taylor & Francis Journals, Taylor & Francis Journals, vol. 42(5), pages 575-588.
  3. Giovanni Mastrobuoni, 2005. "Labor Supply Effects of the Recent Social Security Benefit Cuts: Empirical Estimates Using Cohort Discontinuities," Carlo Alberto Notebooks, Collegio Carlo Alberto 33, Collegio Carlo Alberto, revised 2006.
  4. Xiaoyan Li & Nicole Maestas, 2008. "Does the Rise in the Full Retirement Age Encourage Disability Benefits Applications? Evidence from the Health and Retirement Study," Working Papers, University of Michigan, Michigan Retirement Research Center wp198, University of Michigan, Michigan Retirement Research Center.
  5. Blau, David M. & Goodstein, Ryan, 2007. "What Explains Trends in Labor Force Participation of Older Men in the United States?," IZA Discussion Papers 2991, Institute for the Study of Labor (IZA).
  6. Wojciech Kopczuk & Jae Song, 2008. "Stylized Facts and Incentive Effects Related to Claiming of Retirement Benefits Based on Social Security Administration Data," Working Papers, University of Michigan, Michigan Retirement Research Center wp200, University of Michigan, Michigan Retirement Research Center.
  7. Gaobo Pang & University of Maryland, 2006. "Tax-Deferred Savings and Early Retirement," Computing in Economics and Finance 2006, Society for Computational Economics 31, Society for Computational Economics.
  8. Lex Borghans & Anne C. Gielen & Erzo F.P. Luttmer, 2012. "Social Support Substitution and the Earnings Rebound: Evidence from a Regression Discontinuity in Disability Insurance Reform," NBER Working Papers 18261, National Bureau of Economic Research, Inc.
  9. Nicole Maestas & Julie Zissimopoulos, 2009. "How Longer Work Lives Ease the Crunch of Population Aging," Working Papers, RAND Corporation Publications Department 728, RAND Corporation Publications Department.

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:nbr:nberwo:11811. 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: ().

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.