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Social Security and the Timing of Divorce

Author

Listed:
  • Gopi Shah Goda

    () (Stanford University)

  • John Shoven

    () (Stanford Institue for Economic Policy Research, Stanford University)

  • Sita Nataraj Slavov

    (Economics Department, Occidental College)

Abstract

The Social Security system contains many features designed to provide an adequate retirement income for familes, rather than just individual retired workers. The most important of these features is the spousal benefit, under which secondary earners are entitled to receive a monthly payment of 50 percent of their spouse's monthly Social Security benefit. However, shifts in family structure since the creation of the Social Security program have led to criticisms of the spousal benefit on equity grounds. Using the Panel Study of Income Dynamics (PSID) Marital History File, this paper focuses on one specific implication: Social Security's divorce rules. We find that vulnerable couples are more likely to delay divorce in order to recieve spousal benefits, however the difference is small and statistically insignificant.

Suggested Citation

  • Gopi Shah Goda & John Shoven & Sita Nataraj Slavov, 2009. "Social Security and the Timing of Divorce," Discussion Papers 08-057, Stanford Institute for Economic Policy Research.
  • Handle: RePEc:sip:dpaper:08-057
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    References listed on IDEAS

    as
    1. Gopi Shah Goda, 2007. "Implicit Social Security Tax Rates over the Life Cycle," Discussion Papers 06-021, Stanford Institute for Economic Policy Research.
    2. Feldstein, Martin & Samwick, Andrew A., 1992. "Social Security Rules and Marginal Tax Rates," National Tax Journal, National Tax Association, vol. 45(1), pages 1-22, March.
    3. Stacy Dickert-Conlin & Cristian Meghea, 2004. "The Effect of Social Security on Divorce and Remarriage Behavior," Working Papers, Center for Retirement Research at Boston College wp2004-9, Center for Retirement Research, revised Apr 2004.
    4. Melissa M. Favreault & C. Eugene Steuerle, 2007. "Social Security Spouse and Survivor Benefits for the Modern Family," Working Papers, Center for Retirement Research at Boston College wp2007-07, Center for Retirement Research, revised Feb 2007.
    5. James Alm & Stacy Dickert-Conlin & Leslie A. Whittington, 1999. "Policy Watch: The Marriage Penalty," Journal of Economic Perspectives, American Economic Association, vol. 13(3), pages 193-204, Summer.
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    Cited by:

    1. Stancanelli, Elena G. F., 2014. "Divorcing Upon Retirement: A Regression Discontinuity Study," IZA Discussion Papers 8117, Institute for the Study of Labor (IZA).

    More about this item

    Keywords

    Social Security; divorce; spousal benefit;

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions

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