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Did the Elimination of Mandatory Retirement Affect Faculty Retirement Flows?

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  • Orley Ashenfelter
  • David Card

Abstract

A special exemption from the 1986 Age Discrimination Act allowed colleges and universities to enforce mandatory retirement of faculty at age 70 until 1994. We compare faculty turnover rates at a large sample of institutions before and after the federal law change, and at a set of institutions that were covered by earlier state laws prohibiting compulsory retirement. Retirement rates at institutions that enforced mandatory retirement exhibited sharp 'spikes' at ages 70 and 71. About 90 percent of professors who were still teaching at age 70 retired within two years. After the elimination of compulsory retirement the retirement rates of 70 and 71-year-olds fell to levels comparable to 69-year-olds, and over one-half of 70-year-olds were still teaching two years later. These findings indicate that U.S. colleges and universities will experience a rise in the number of older faculty over the coming years. The increase is likely to be larger at private research universities, where a higher fraction of faculty has traditionally remained at work until age 70.

Suggested Citation

  • Orley Ashenfelter & David Card, 2001. "Did the Elimination of Mandatory Retirement Affect Faculty Retirement Flows?," NBER Working Papers 8378, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:8378
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    1. repec:fth:prinin:448 is not listed on IDEAS
    2. Orley Ashenfelter & David Card, 2001. "Did the Elimination of Mandatory Retirement Affect Faculty Retirement Flows?," NBER Working Papers 8378, National Bureau of Economic Research, Inc.
    3. Lumsdaine, Robin L. & Mitchell, Olivia S., 1999. "New developments in the economic analysis of retirement," Handbook of Labor Economics,in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 49, pages 3261-3307 Elsevier.
    4. Orley Ashenfelter & David Card, 2002. "Did the Elimination of Mandatory Retirement Affect Faculty Retirement?," American Economic Review, American Economic Association, vol. 92(4), pages 957-980, September.
    5. Orley Ashenfelter & David Card, 2000. "How Did the Elimination of Mandatory Retirement Affect Faculty Retirement?," Working Papers 827, Princeton University, Department of Economics, Industrial Relations Section..
    6. Orley Ashenfelter & David Card, 2000. "How Did the Elimination of Mandatory Retirement Affect Faculty Retirement?," Working Papers 827, Princeton University, Department of Economics, Industrial Relations Section..
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    Cited by:

    1. Orley Ashenfelter & David Card, 2002. "Did the Elimination of Mandatory Retirement Affect Faculty Retirement?," American Economic Review, American Economic Association, vol. 92(4), pages 957-980, September.
    2. Avner Ahituv & Joseph Zeira, 2011. "Technical Progress and Early Retirement," Economic Journal, Royal Economic Society, vol. 121(551), pages 171-193, March.
    3. Ashenfelter, Orley & Card, David, 2001. "Did the Elimination of Mandatory Retirement Affect Faculty Retirement Flows?," IZA Discussion Papers 402, Institute for the Study of Labor (IZA).
    4. David Neumark, 2003. "Age Discrimination Legislation in the United States," Contemporary Economic Policy, Western Economic Association International, vol. 21(3), pages 297-317, July.
    5. David Card & Michael Ransom, 2011. "Pension Plan Characteristics and Framing Effects in Employee Savings Behavior," The Review of Economics and Statistics, MIT Press, vol. 93(1), pages 228-243, February.

    More about this item

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education

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