Simulating the Response to Reform of Canada's Income Security Programs
We explore the fiscal implications of reforms to the Canadian retirement income system by decomposing the fiscal effect of reforms into two components. The mechanical effect captures the change in the government's budget assuming no behavioral response to the reform. The second component is the fiscal implication of the behavioral effect, which captures the influence of any induced changes in elderly labor supply on government budgets. We find that the behavioral response can account for up to half of the total impact of reform on government budgets. The behavioral response affects government budgets not only in the retirement income system but also through increased income, payroll, and consumption tax revenue on any induced labor market earnings among the elderly. We show that fully accounting for the behavioral response to reforms can change the cost estimates and distributive impact of retirement income reforms.
|Date of creation:||Jan 2003|
|Date of revision:|
|Publication status:||published as Baker, Michael, Jonathan Gruber and Kevin Milligan. "The Retirement Incentive Effects Of Canada's Income Security Programs," Canadian Journal of Economics, 2003, v36(2,May), 261-290.|
|Note:||AG LS PE|
|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.:
- Michael Baker, 1999.
"The Retirement Behavior of Married Couples: Evidence from the Spouse's Allowance,"
NBER Working Papers
7138, National Bureau of Economic Research, Inc.
- Michael Baker, 2002. "The Retirement Behavior of Married Couples: Evidence from the Spouse's Allowance," Journal of Human Resources, University of Wisconsin Press, vol. 37(1), pages 1-34.
- Michael Baker, . "The Retirement Behavior of Married Couples: Evidence From The Spouse’s Allowance," Department of Economics 99-03, California Davis - Department of Economics.
- Michael Baker, 2003. "The Retirement Behavior of Married Couples: Evidence From The Spouse's Allowance," Working Papers 993, University of California, Davis, Department of Economics.
- Michael Baker, 1999. "The Retirement Behavior of Married Couples: Evidence From the Spouse's Allowance," Working Papers baker-99-01, University of Toronto, Department of Economics.
- Stock, James H & Wise, David A, 1990.
"Pensions, the Option Value of Work, and Retirement,"
Econometric Society, vol. 58(5), pages 1151-80, September.
- James H. Stock & David A. Wise, 1988. "Pensions, The Option Value of Work, and Retirement," NBER Working Papers 2686, National Bureau of Economic Research, Inc.
- Kevin Milligan, 2002.
"Tax-preferred savings accounts and marginal tax rates: evidence on RRSP participation,"
Canadian Journal of Economics,
Canadian Economics Association, vol. 35(3), pages 436-456, August.
- Kevin Milligan, 2001. "Tax-Preferred Savings Accounts and Marginal Tax Rates: Evidence on RRSP Participation," Social and Economic Dimensions of an Aging Population Research Papers 52, McMaster University.
- Jonathan Gruber & David A. Wise, 2004.
"Social Security Programs and Retirement around the World: Micro-Estimation,"
National Bureau of Economic Research, Inc, number grub04-1.
- Jonathan Gruber & David A. Wise, 2002. "Social Security Programs and Retirement Around the World: Micro Estimation," NBER Working Papers 9407, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:9455. 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.