How Social Security Reform Affects Retirement and Pension Claiming-Reference-Cited by-同舟云学术

How Social Security Reform Affects Retirement and Pension Claiming

Published:2023-08-01 Issue:3 Volume:15 Page:115-150
ISSN:1945-7731
Container-title:American Economic Journal: Economic Policy
language:en
Short-container-title:American Economic Journal: Economic Policy

Author:

Lalive Rafael¹,Magesan Arvind²,Staubli Stefan³

Affiliation:

1. University of Lausanne, CEPR, CESifo, IFAU, and IZA (email: )

2. University of Calgary (email: )

3. University of Calgary, CEPR, IZA, NBER, and Retirement and Savings Institute at HEC Montréal (email: )

Abstract

A reform increasing the full retirement age (FRA) by one year leads to larger than expected delays in pension claiming and retirement, while making late claiming more lucrative leads to a smaller than expected delay in pension claiming. Survey evidence shows people view the FRA as the “normal” retirement age and prefer to couple pension claiming and retirement decisions together, even though these two decisions are not coupled through social security provisions. Two mechanisms are at work: reference dependence with loss aversion in pension claiming, and spillovers from pension claiming on retirement choices. The FRA increase leads to large government savings. (JEL H55, J26)

Publisher

American Economic Association

Subject

General Economics, Econometrics and Finance

Link

https://pubs.aeaweb.org/doi/pdf/10.1257/pol.20200686

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