Work

The Employment Effects of the Social Security Earnings Test

Year: 2020

Type: report

Abstract: We investigate the impact of the Social Security Annual Earnings Test (AET) on the employment decisions of older Americans.The AET reduces Social Security benefits by one dollar for every two dollars earned above the exempt amount.Using a differences-in-differences design, we find that the employment rate of those predicted to become subject to the AET decreases substantially relative to those not predicted to become subject to it.The point estimates suggest that the AET reduces the employment rate of Americans aged 63-64 by at least 1.2 percentage points.

Source: National Bureau of Economic Research

DOI: 10.3386/w26696

Authors: Alexander Gelber, Damon Jones, Daniel Sacks, Jae Song

Institutions: National Bureau of Economic Research, University of California San Diego, University of Chicago, Indiana University Bloomington, Indiana University

Language: English

Topic: Retirement, Disability, and Employment

Subfield: Demography

Field: Social Sciences

Domain: Social Sciences

SDGs: Decent work and economic growth, No poverty, Reduced inequalities

Open Access status: green

Funders: Alfred P. Sloan Foundation, U.S. Social Security Administration, Australian Government, Stanford Institute for Economic Policy Research

OpenAlex ID: W4230584585

Cites: 43

Cited by: 9

Related to: 10