IDEAS home Printed from https://ideas.repec.org/a/sae/pubfin/v24y1996i3p349-370.html
   My bibliography  Save this article

Distributional Effects of Social Security: the Notch Issue Revisited

Author

Listed:
  • James E. Duggan

    (Office of Economic Policy, U.S. Department of the Treasury)

  • Robert Gillingham

    (Office of Economic Policy, U.S. Department of the Treasury)

  • John S. Greenlees

    (Office of Prices and Living Conditions, U.S. Bureau of Labor Statistics)

Abstract

This article provides the first empirical estimates of the effects of the Social Security Abstract benefit notch on lifetime benefits based on actual Social Security records, the 1988 Continuous Work History Sample. The authors'results show that the notch occurred in the context of a maturing social insurance system in which all early cohorts have received very high rates of return. As a group, the 1917-1921 notch cohorts could expect to receive roughly $500 billion (in 1988 dollars) more than if they were paid the same rate of return on their contnbutions that the Social Security system earns on its investedfunds.

Suggested Citation

  • James E. Duggan & Robert Gillingham & John S. Greenlees, 1996. "Distributional Effects of Social Security: the Notch Issue Revisited," Public Finance Review, , vol. 24(3), pages 349-370, July.
  • Handle: RePEc:sae:pubfin:v:24:y:1996:i:3:p:349-370
    DOI: 10.1177/109114219602400303
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/109114219602400303
    Download Restriction: no

    File URL: https://libkey.io/10.1177/109114219602400303?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. James E. Duggan & Robert Gillingham & John S. Greenlees, 1993. "Returns Paid To Early Social Security Cohorts," Contemporary Economic Policy, Western Economic Association International, vol. 11(4), pages 1-13, October.
    2. Krueger, Alan B & Pischke, Jorn-Steffen, 1992. "The Effect of Social Security on Labor Supply: A Cohort Analysis of the Notch Generation," Journal of Labor Economics, University of Chicago Press, vol. 10(4), pages 412-437, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Lovell, Michael C., 2009. "Social Security's Five OASI Inflation Indexing Problems," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 3, pages 1-41.
    2. Matthias Doepke, "undated". "Inflation as a Redistribution Shock: Effects on Aggregates and Welfare," UCLA Economics Online Papers 412, UCLA Department of Economics.
    3. Matthias Doepke & Martin Schneider, 2005. "Real effects of inflation through the redistribution of nominal wealth," Staff Report 355, Federal Reserve Bank of Minneapolis.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Feldstein, Martin & Liebman, Jeffrey B., 2002. "Social security," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 4, chapter 32, pages 2245-2324, Elsevier.
    2. repec:spo:wpmain:info:hdl:2441/2091 is not listed on IDEAS
    3. John Geanakoplos & Olivia S. Mitchell & Stephen P. Zeldes, "undated". "Social Security Money's Worth," Pension Research Council Working Papers 97-20, Wharton School Pension Research Council, University of Pennsylvania.
    4. Bernardo Lanza Queiroz, 2007. "The determinants of male retirement in urban Brazil," Nova Economia, Economics Department, Universidade Federal de Minas Gerais (Brazil), vol. 17(1), pages 11-36, January-A.
    5. Malkova, Olga, 2020. "Did Soviet elderly employment respond to financial incentives? Evidence from pension reforms," Journal of Public Economics, Elsevier, vol. 182(C).
    6. Andreas Eder, 2016. "The impact of inheritances on the retirement behavior of older Europeans," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 43(2), pages 299-331, May.
    7. Eduardo Fé & Bruce Hollingsworth, 2016. "Short- and long-run estimates of the local effects of retirement on health," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 179(4), pages 1051-1067, October.
    8. Yvonne Adema & Jan Bonenkamp & Lex Meijdam, 2016. "Flexible pension take-up in social security," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 23(2), pages 316-342, April.
    9. Sudipto Banerjee & David Blau, 2016. "Employment Trends by Age in the United States: Why Are Older Workers Different?," Journal of Human Resources, University of Wisconsin Press, vol. 51(1), pages 163-199.
    10. Etgeton, Stefan & Fischer, Björn & Ye, Han, 2023. "The effect of increasing retirement age on households’ savings and consumption expenditure," Journal of Public Economics, Elsevier, vol. 221(C).
    11. repec:hal:spmain:info:hdl:2441/2091 is not listed on IDEAS
    12. Emile Cammeraat, 2020. "The relationship between different social expenditure schemes and poverty, inequality and economic growth," International Social Security Review, John Wiley & Sons, vol. 73(2), pages 101-123, April.
    13. David Candon, 2019. "The joint effect of health shocks and eligibility for social security on labor supply," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 20(7), pages 969-988, September.
    14. Leora Friedberg, 2000. "The Labor Supply Effects of the Social Security Earnings Test," The Review of Economics and Statistics, MIT Press, vol. 82(1), pages 48-63, February.
    15. Jacques Le Cacheux & Vincent Touzé, 2002. "Les modèles d'équilibre général calculable à générations imbriquées. Enjeux, méthodes et résultats," Revue de l'OFCE, Presses de Sciences-Po, vol. 80(1), pages 87-113.
    16. John Rust & Christopher Phelan, 1997. "How Social Security and Medicare Affect Retirement Behavior in a World of Incomplete Markets," Econometrica, Econometric Society, vol. 65(4), pages 781-832, July.
    17. Engelhardt, Gary V., 2008. "Social security and elderly homeownership," Journal of Urban Economics, Elsevier, vol. 63(1), pages 280-305, January.
    18. Pedro Cavalcanti Ferreira & Marcelo Rodrigues dos Santos, 2013. "The Effect of Social Security, Health, Demography and Technology on Retirement," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 16(2), pages 350-370, April.
    19. Moulton, Jeremy Grant & Stevens, Ann Huff, 2015. "Reconsidering the Social Security Notch and retirement: Wealth and incentive effects," Economics Letters, Elsevier, vol. 132(C), pages 65-68.
    20. Barbara Hanel & Regina Riphahn, 2006. "Financial Incentives and the Timing of Retirement: Evidence from Switzerland," Working Papers 009, Bavarian Graduate Program in Economics (BGPE).
    21. Coile Courtney, 2004. "Retirement Incentives and Couples' Retirement Decisions," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 4(1), pages 1-30, July.
    22. Andras Simonovits, 2020. "Indexing public pensions in progress to wages or prices," CERS-IE WORKING PAPERS 2015, Institute of Economics, Centre for Economic and Regional Studies.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:pubfin:v:24:y:1996:i:3:p:349-370. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.