Earnings Growth versus Measures of Income and Education for Predicting Mortality

Authors

Abstract

This paper begins an exploration to determine whether earnings growth, as a measure of the propensity to invest in human capital, is a valuable variable for predicting mortality. To insure its robustness and general applicability to ongoing Social Security models, the usefulness of earnings growth as a predictor of mortality will be explored in multiple time periods. This paper begins that process by reporting preliminary results for an early time period using the 1973 CPS-SSA-IRS Exact Match file. In addition to presenting preliminary results, the paper also describes how data challenges associated with the pre-1978 administrative record data on earnings and mortality are met.

Key Findings

  • Earnings growth, measured over the entire career of individuals, appears to supersede income’s effect as a predictor of mortality.
  • Both education and earnings growth are useful for predicting mortality.
  • Earnings growth measured at the beginning of the working career appears to be a viable predictor of subsequent mortality.
  • The final result is of particular use in forecasting models that rely only on Social Security’s administrative record data since the administrative record data lack information on years of schooling.

Full Text

Download PDF

Project

Paper ID

WP 2011-257

Publication Type

Working Paper

Publication Year

2011
pavement-enterprise