Impact of retirement program changes since 1980 on labor force participation rates in the U.S

by

Table of Contents

Chapter 1: Introduction3

Chapter 2: Literature Review5

Economics of Aging6

Life Cycle Approach7

Employment Taxes8

Employment taxes8

Evolution Of The Labor Participation Of The Elderly Since The Mid-1980s9

Supplementary Estimates Of Effect In US11

Data used and sample characteristics12

Chapter 4: Results and Analysis13

Works Cited17

Chapter 1: Introduction

After a long downward trend in labor force participation of men over 54 years in most OECD countries, there has been a significant increase in the same since the mid-late 80's. This is a phenomenon that has also taken place in the whole of US and much of its Autonomous Communities, although distinguishing nuances. This is associated with known active aging from the perspective of socio-economic, involves the ability of seniors to remain integrated into the labor market, which contribute their important work experience and vital public systems and soothing revenue-sharing (Heckman, 188).

The motivations of this turnaround in the trend of the participation of more men have received considerable attention in the literature and found justifications that have been operated by both the supply-demand side. The first of these two perspectives seems set to be the most important and is relevant in this regard, which has received increased attention in the literature. As determinants of supply operating peculiarities of each socio-occupational worker: age, marital status, health, family responsibilities, the peculiarities of their training, qualifications and work experience in addition to these, are in the first line of the family characteristics in which this is integrated (Becker, 14).

First, the change occurred in the training profiles of the elderly workforce appears to be one of the most relevant explanations of elongation working life of these cohorts. More educated workers are more involved in the labor market, not only because they receive higher pay but also because their occupations usually need less physically demanding (Bergman, 89). Goldin and Katz (2008) explain this effect for the United States with appreciable effect.

Secondly, the health status of collective labor seems to have analyzed in their decision to stay or withdrawal of the workforce (Borjas, 531). Nevertheless, as seen from the work of Glodin and Katz (2008), the changes occurring in the programs of the U.S. Social Security does not seem to have been particularly relevant as to explain the reversal in the trend series involving older men, at least in the short term.

Finally, a variable with potential relevance in the decision participation of older men is the participation decision of their wives or official partners. As is known, the female participation rate has experienced over the past decades, so that a traditionally inactive group (older women) now has a meaningful participation rate (Blau, 54). However, theoretical models for determining labor force participation tell us about the effect called 'leisure complementary' or "Shared" operating in a special way in couples formally established and which implies that the decision to participate (retired) work of one of its members remaining member may induce a reflex effect (Becker, 14). Furthermore, this decision seems to operate asymmetric, since the ...