Full Citation

Title: Revisiting Wage and Hours Profiles

Citation Type: Working Paper

Publication Year: 2014

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Abstract: We document empirical life cycle profiles of wages and hours of work for pay from CPS and the PSID. We bring to light a new fact: for the youngest cohorts whose entire working life can be observed, hours start falling much earlier than wages. Wages do not fall (if they fall at all) until one's late 60's. The data suggest that many workers start a smooth transition into retirement by working progressively fewer hours while still facing an upward-sloping wage profile. We show that this pattern is not an artifact of staggered abrupt retirement or selection. We explore the nontrivial restrictions this evidence imposes on dynamic models of the aggregate economy, and we provide updated numerical profiles that can be readily used in quantitative macroeconomic analysis to incorporate this new pattern into aggregate models.

Url: www2.dse.unibo.it/zanella/papers/profiles.pdf

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Authors: Rupert, Peter; Zanella, Giulio

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Publication Number: 936

Institution: Univeristy of Bologna

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Publisher Location: Bologna, Italy

Data Collections: IPUMS CPS

Topics: Aging and Retirement, Education, Labor Force and Occupational Structure

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