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Title: Life Cycle Labor Supply and Retirement in a Model With Endogenous Human Capital Accumulation

Citation Type: Miscellaneous

Publication Year: 2009

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Abstract: In this paper, I develop a general equilibrium model of life cycle labor supply and use it to assess the effects of various features of social security programs on labor supply outcomes. An endogenous workweek and retirement margin, as well as endogenous human capital accumulation are the key features of the framework. I find that if one ignores the earnings dependence of social security benefits, one will over-estimate the distortionary effects of higher labor income taxes. However, once accounting for differences in both social security taxes and other labor taxes, I find that taxes account for a large share of the difference in aggregate hours worked between the U.S. and continental Europe. In addition to the generosity of social security programs, the rules regarding eligibility and working also account for a large share of this difference.

Url: http://hassler-j.iies.su.se/nordmac/MacNord/Wallenius.pdf

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Authors: Wallenius, Johanna

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Data Collections: IPUMS CPS

Topics: Labor Force and Occupational Structure

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