Working Paper: NBER ID: w25411
Authors: Melinda S. Morrill; John Westall
Abstract: This study documents an important role for Social Security income in workers' retirement timing. About 40 percent of public school teachers are not covered by Social Security. This provides an opportunity to analyze the causal impact of Social Security on retirement timing by comparing covered and non-covered teachers. Using individual-level data from the American Community Survey, we find robust evidence of higher rates of retirement among covered teachers at Social Security eligibility ages. This pattern is confirmed using an alternative regression model of participation in the teacher labor force. These estimates suggest that, should the federal government mandate full inclusion in Social Security for all public sector workers, the retirement timing patterns of newly covered teachers and other public sector workers would likely change.
Keywords: Social Security; Retirement Timing; Teachers; Public Sector Workers
JEL Codes: H55; H75; I28; J26
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| retirement timing (J26) | labor supply of teachers (J45) |
| social security eligibility (H55) | retirement rates among teachers aged 62 to 70 (J26) |
| social security coverage (H55) | labor force participation rates of teachers (J45) |