Dissaving After Retirement: Testing the Pure Life Cycle Hypothesis
In this paper, we examine several aspects of saving and dissaving after retirement. First, we argue that existing evidence on bequeathable age-wealth profiles is suspect, and provide new evidence based on longitudinal data indicating that significant dissaving may occur,particularly among single individuals and early retirees. Second, we argue that, in the presence of annuities, estimates of dissaving should be adjusted by including the simple discounted value of benefits in total wealth. Such adjustments reveal relatively little dissaving among any group of retirees. Finally, we test the pure life cycle hypothesis by observing the behavioral response of rates of accumulation to involuntary annuitization, and find empirical refutation of life cycle implications.
|Date of creation:||Jul 1984|
|Date of revision:|
|Publication status:||published as Bernheim, B. Douglas. "Dissaving After Retirement: Testing the Pure Life Cycle Hypothesis," Issues in Pension Economics, ed. by Z. Bodie, J.B. Shoven, D.A. Wise, Chicago: UCP, 1987.|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
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.:
- Loury, Glenn C, 1981. "Intergenerational Transfers and the Distribution of Earnings," Econometrica, Econometric Society, vol. 49(4), pages 843-67, June.
- Feldstein, Martin S, 1974. "Social Security, Induced Retirement, and Aggregate Capital Accumulation," Journal of Political Economy, University of Chicago Press, vol. 82(5), pages 905-26, Sept./Oct.
- Mervyn A. King & Louis Dicks-Mireaux, 1981. "Asset Holdings and the Life Cycle," NBER Working Papers 0614, National Bureau of Economic Research, Inc.
- King, M A & Dicks-Mireaux, L-D L, 1982. "Asset Holdings and the Life-Cycle," Economic Journal, Royal Economic Society, vol. 92(366), pages 247-67, June.
- Diamond, P. A. & Hausman, J. A., 1984. "Individual retirement and savings behavior," Journal of Public Economics, Elsevier, vol. 23(1-2), pages 81-114.
- Atkinson, A B, 1971. "The Distribution of Wealth and the Individual Life-cycle," Oxford Economic Papers, Oxford University Press, vol. 23(2), pages 239-54, July.
- Feldstein, Martin & Pellechio, Anthony, 1979. "Social Security and Household Wealth Accumulation: New Microeconometric Evidence," The Review of Economics and Statistics, MIT Press, vol. 61(3), pages 361-68, August.
- Kotlikoff, Laurence J & Spivak, Avia, 1981.
"The Family as an Incomplete Annuities Market,"
Journal of Political Economy,
University of Chicago Press, vol. 89(2), pages 372-91, April.
- Laurence J. Kotlikoff & Avia Spivak, 1979. "The Family as an Incomplete Annuities Market," NBER Working Papers 0362, National Bureau of Economic Research, Inc.
- Laurence J. Kotlikoff & Avia Spivak, 1979. "The Family as an Incomplete Annuities Market," UCLA Economics Working Papers 151, UCLA Department of Economics.
- B. Douglas Bernheim & Andrei Shleifer & Lawrence H. Summers, 1984. "Bequests as a Means of Payment," NBER Working Papers 1303, National Bureau of Economic Research, Inc.
- Davies, James B, 1981. "Uncertain Lifetime, Consumption, and Dissaving in Retirement," Journal of Political Economy, University of Chicago Press, vol. 89(3), pages 561-77, June.
- Mirer, Thad W, 1979. "The Wealth-Age Relation among the Aged," American Economic Review, American Economic Association, vol. 69(3), pages 435-43, June.
- Dicks-Mireaux, Louis & King, Mervyn, 1984. "Pension wealth and household savings: Tests of robustness," Journal of Public Economics, Elsevier, vol. 23(1-2), pages 115-139.
- Ferber, Robert, et al, 1969. "Validation of a National Survey of Consumer Financial Characteristics: Savings Accounts," The Review of Economics and Statistics, MIT Press, vol. 51(4), pages 436-44, November.
- Michael D. Hurd & John B. Shoven, 1983.
"The Distributional Impact of Social Security,"
NBER Working Papers
1155, National Bureau of Economic Research, Inc.
- Kotlikoff, Laurence J, 1979. "Testing the Theory of Social Security and Life Cycle Accumulation," American Economic Review, American Economic Association, vol. 69(3), pages 396-410, June.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:1409. 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 references are entirely missing, you can add them using this form.