2003
Saving for Retirement: Wage Growth and Unexpected Events
WP 2003-045 , UM02-05
We found that there is a perception of ‘under-saving’ for retirement among many individuals. Individuals who perceive they have saved inadequately attribute this mainly to having insufficient income. Under a lifecycle model of consumption with a known income path this…
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The Economic Status of Elderly Divorced Women
WP 2003-046 , UM02-08
Over the past 35 years the gap in poverty between divorced and married women increased from 2:1 (in 1967) to 4:1 (in 2001). Despite high poverty rates, divorced women are no less educated than married women. Labor market earnings are…
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Mental Health and Labor Force Exits in Older Workers: The Mediating or Moderating Roles of Physical Health and Job Factors
WP 2003-047 , UM01-07
This paper extends earlier health and work studies by examining how mental health affects transitions out of paid work in the years prior to the traditional Social Security retirement ages. Given recent changes in the labor market, optimal mental health…
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Lifetime Earnings Variability and Retirement Wealth
WP 2003-051 , UM01-C1
This paper explores how earnings variability is related to retirement wealth. Past research has demonstrated that the average American household on the verge of retirement would need to save substantially more, in order to preserve consumption flows in old age.…
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What to Expect when you are Expecting Rationality: Testing Rational Expectations using Micro Data
WP 2003-037 , UM02-11
This paper tests the Rational Expectations (RE) hypothesis regarding retirement expectations, controlling for sample selection, reporting biases, and unobserved heterogeneity. We find that retirement expectations in the Health and Retirement Study (HRS) are consistent with the RE hypothesis. We also…
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Defined Benefit Pension Plan Liabilities and International Asset Allocation
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A Lifecycle Analysis of Defined Benefit Pension Plans
WP 2003-053 , UM02-D1
This paper employs a lifecycle model from the consumption-savings literature to examine the tradeoffs between defined benefit and defined contribution pension plans. We examine the effects of varying risk aversion, varying initial income and financial wealth, and varying wage processes…
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Understanding Individual Account Guarantees
WP 2003-035 , UM02-D2
Demographic aging renders workers vulnerable to the inherent uncertainty of unfunded social security systems. This realization has set off a global wave of social security reforms, and more than 20 countries have set up Individual Accounts (IA) plans in response.…
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Social Security, Retirement and Wealth: Theory and Implications
WP 2003-054 , UM02-10
The effect of Social Security rules on the age people choose to retire can be critical in evaluating proposed changes to those rules. This research derives a theory of retirement that views retirement as a special type of labor supply…
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The Annuity Puzzle Revisited
WP 2003-055 , UM02-01
There is a pressing need for a better understanding of how access to various types of financial products can impact retirement behavior, especially if this access comes from a change in the incentive scheme through a reform of the current…
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