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Labor Market Shocks and Early Social Security Benefit Claiming

Author

Listed:
  • David Card

    (University of California-Berkeley)

  • Nicole Maestas

    (RAND)

  • Patrick Purcell

    (Social Security Administration)

Abstract

Many job-losers suffer large and persistent losses in earnings capacity. For displaced workers who are age-eligible, one reaction to these losses is to begin claiming Social Security retirement benefits. We use administrative earnings records from the Social Security Administration’s Continuous Work History Sample to study the impacts of labor market shocks among workers in their late 50’s and early 60’s on Social Security retirement benefit claiming rates. We find that labor market shocks lead to current and future increases in the fraction of insured workers who initiate Social Security benefits at the earliest possible claiming age. Moreover, once they initiate benefits, early claimants continue to have low levels of earnings in all subsequent years.

Suggested Citation

  • David Card & Nicole Maestas & Patrick Purcell, 2014. "Labor Market Shocks and Early Social Security Benefit Claiming," Working Papers wp317, University of Michigan, Michigan Retirement Research Center.
  • Handle: RePEc:mrr:papers:wp317
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    File URL: http://www.mrrc.isr.umich.edu/publications/Papers/pdf/wp317.pdf
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    References listed on IDEAS

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    1. Jacobson, Louis S & LaLonde, Robert J & Sullivan, Daniel G, 1993. "Earnings Losses of Displaced Workers," American Economic Review, American Economic Association, vol. 83(4), pages 685-709, September.
    2. Louis S. Jacobson & Robert J. LaLonde & Daniel G. Sullivan, 1993. "Long-term earnings losses of high-seniority displaced workers," Economic Perspectives, Federal Reserve Bank of Chicago, issue Nov, pages 2-20.
    3. David H. Autor & Mark G. Duggan, 2003. "The Rise in the Disability Rolls and the Decline in Unemployment," The Quarterly Journal of Economics, Oxford University Press, vol. 118(1), pages 157-206.
    4. Courtney C. Coile & Phillip B. Levine, 2007. "Labor Market Shocks and Retirement: Do Government Programs Matter?," NBER Chapters,in: Public Policy and Retirement, Trans-Atlantic Public Economics Seminar (TAPES), pages 1902-1919 National Bureau of Economic Research, Inc.
    5. Nicole Maestas & Kathleen J. Mullen & Alexander Strand, 2013. "Does Disability Insurance Receipt Discourage Work? Using Examiner Assignment to Estimate Causal Effects of SSDI Receipt," American Economic Review, American Economic Association, vol. 103(5), pages 1797-1829, August.
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    Cited by:

    1. Gustman, Alan L. & Steinmeier, Thomas L., 2015. "Effects of social security policies on benefit claiming, retirement and saving," Journal of Public Economics, Elsevier, vol. 129(C), pages 51-62.

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