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Social Security And Retirees’ Decision To Work

  • Mark E. Votruba

    (Case Western Reserve University)

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    Non-linearities in the Social Security benefits formula are used to estimate the effect of benefit size on the probability married beneficiaries work after initiating benefits. Consistent with economic theory, benefit size has a significant, negative effect on the probability of post-retirement work. A 10% increase in benefit size decreases the probability of work 3-4 percentage points for recently retired husbands (from a mean of 25.5%) and 2-3 percentage points for recently retired wives (from a mean of 12.8%). For both spouses, the effect erodes in later years of retirement.

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    File URL: http://www.princeton.edu/ceps/workingpapers/95votruba.pdf
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    Paper provided by Princeton University, Department of Economics, Center for Economic Policy Studies. in its series Working Papers with number 107.

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    Date of creation: Nov 2003
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    Handle: RePEc:pri:cepsud:95votruba
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