Probabilistic Thinking and Early Social Security Claiming
This study analyzes the extent to which an individual’s survival expectations influence his or her decision to claim social security benefits at an early age. We find that subjective survival probabilities capture meaningful behavioral responses to incentives for early Social Security claiming when they are purged of measurement error using risk factors as instruments. Among people who are still working at age 62, those who expect to live longer are likely to delay claiming of Social Security benefits to a degree that is both statistically and economically significant. For example, an increase of 5 percentage points in the subjective probability of survival to age 75 of each person leads to a 1.9 percentage point decline in the proportion who claim before age 64, from 29.6 percent to 27.7 percent.
|Date of creation:||Sep 2006|
|Contact details of provider:|| Postal: P.O. Box 1248, Ann Arbor, MI 48104|
Phone: (734) 615-0422
Fax: (734) 647-4575
Web page: http://www.mrrc.isr.umich.edu/publications/papers/
More information through EDIRC
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.:
- Michael D. Hurd & James P. Smith & Julie M. Zissimopoulos, 2004.
"The effects of subjective survival on retirement and Social Security claiming,"
Journal of Applied Econometrics,
John Wiley & Sons, Ltd., vol. 19(6), pages 761-775.
- Michael D. Hurd & James P. Smith & Julie M. Zissimopoulos, 2002. "The Effects of Subjective Survival on Retirement and Social Security Claiming," Working Papers wp021, University of Michigan, Michigan Retirement Research Center.
- Michael Hurd & James P. Smith & Julie M. Zissimopoulos, 2003. "The Effects of Subjective Survival on Retirements and Social Security Claiming," Working Papers 03-11, RAND Corporation.
- Michael D. Hurd & James P. Smith & Julie M. Zissimopoulos, 2002. "The Effects of Subjective Survival on Retirement and Social Security Claiming," NBER Working Papers 9140, National Bureau of Economic Research, Inc.
- Charles F. Manski, 2004. "Measuring Expectations," Econometrica, Econometric Society, vol. 72(5), pages 1329-1376, 09.
- Adeline Delavande & Susann Rohwedder, 2008. "Differential Mortality in Europe and the U.S.: Estimates Based on Subjective Probabilities of Survival," Working Papers 613, RAND Corporation.
- Daniel S. Hamermesh, 1985. "Expectations, Life Expectancy, and Economic Behavior," The Quarterly Journal of Economics, Oxford University Press, vol. 100(2), pages 389-408.
- Daniel S. Hamermesh, 1982. "Expectations, Life Expectancy, and Economic Behavior," NBER Working Papers 0835, National Bureau of Economic Research, Inc.
- Gábor Kézdi & Robert J. Willis, 2003. "Who Becomes a Stockholder? Expectations, SUbjective Uncertainty, and Asset Allocation," Working Papers wp039, University of Michigan, Michigan Retirement Research Center.
- Oswald, Andrew & Jonathan Gardner, 2003. "Is it Money or Marriage that Keeps People Alive?," Royal Economic Society Annual Conference 2003 161, Royal Economic Society.
- Michael D. Hurd & Kathleen McGarry, 1995. "Evaluation of the Subjective Probabilities of Survival in the Health and Retirement Study," Journal of Human Resources, University of Wisconsin Press, vol. 30, pages s268-s292.
- Michael D. Hurd & Kathleen McGarry, 2002. "The Predictive Validity of Subjective Probabilities of Survival," Economic Journal, Royal Economic Society, vol. 112(482), pages 966-985, October.
- Michael D. Hurd & Kathleen McGarry, 1997. "The Predictive Validity of Subjective Probabilities of Survival," NBER Working Papers 6193, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:mrr:papers:wp129. 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: (MRRC Administrator)
If references are entirely missing, you can add them using this form.