A Test for Anchoring and Yea-Saying in Experimental Consumption Data

In the experimental module of the AHEAD 1995 data, the sample is randomly split into respondents who get an open-ended question on the amount of total family consumption - with follow-up unfolding brackets (of the form: is consumption $X or more?) for those who answer don't know' or refuse' - and respondents who are immediately directed to unfolding brackets. In both cases, the entry point of the unfolding bracket sequence is randomized. These data are used to develop a nonparametric test for whether people make mistakes in answering the first bracket question, allowing for any type of selection into answering the open-ended question or not. Two well-known types of mistakes are considered: anchoring and yea-saying (or acquiescence). While the literature provides ample evidence that the entry point in the first bracket question serves as an anchor for follow-up bracket questions, it is less clear whether the answers to the first bracket question are already affected by anchoring. We reject the joint hypothesis of no anchoring and no yea-saying at the entry point. Once yea-saying is taken into account

Retirement and home production : A regression discontinuity approach

Existing studies show that individuals who retire replace some private consumption by home production, but do not consider joint behaviour of couples. Here we analyze the causal effect of retirement of each partner on hours of home production of both partners in a couple. Our identification strategy exploits the earliest age retirement laws in France, enabling a fuzzy regression discontinuity approach. We find that own retirement significantly increases own hours of home production and the effect is larger for men than for women. Moreover, retirement of the female partner significantly reduces male hours of home production but not vice versa.House work, Ageing,Retirement,Regression Discontinuity

The Impact of Misperceptions about Social Security on Saving and Well-being

Earlier research suggests that many people in their fifties and early sixties are not well informed about their Social Security benefit entitlements in old age. This paper investigates the effect of deviations between individuals’ anticipated and realized Social Security benefits on several measures of well-being in retirement, such as the change in consumption expenditures at retirement, a self-assessed measure of how retirement years compare to the years before retirement, and whether the retired individual is worried about having enough income to get by. The analysis is based upon US data from the Health and Retirement Study, following individuals over a long time period from their fifties into retirement. We find that people who over estimated their Social Security benefits are worse off according to several measures of well being in retirement. This relationship seems to be more pronounced for respondents who claimed benefits earlier than anticipated than for those who were misinformed.

How Sensitive Are Retirement Decisions to Financial Incentives: A Stated Preference Analysis

We study effects of financial incentives on the retirement age using stated preference data. Dutch survey respondents were given hypothetical retirement scenarios describing age(s) of (partial and full) retirement and replacement rate(s). A structural model is estimated in which utility is the discounted sum of within period utilities that depend on employment status and income. Parameters of the utility function vary with observed and unobserved characteristics. Simulations show that the income and substitution effects of pensions as a function of the retirement age are substantial and larger than according to studies using data on actual retirement decisions.pensions, flexible retirement, gradual retirement, stated choices

Mode and Context Effects in Measuring Household Assets

Differences in answers in Internet and traditional surveys can be due to selection, mode, or context effects. We exploit unique experimental data to analyze mode and context effects controlling for arbitrary selection. The Health and Retirement Study (HRS) surveys a random sample of the US 50+ population, with CAPI or CATI core interviews once every two years. In 2003 and 2005, random samples were drawn from HRS respondents in 2002 and 2004 willing and able to participate in an Internet interview. Comparing core and Internet survey answers of the same people, we analyze mode and context effects, controlling for selection. We focus on household assets, for which mode effects in Internet surveys have rarely been studied. We find some large differences between the first Internet survey and the other three surveys which we interpret as a context and question wording effect rather than a pure mode effect.Internet surveys, CAPI, CATI, portfolio choice

Birth Spacing, Fertility and Neonatal Mortality in India:Dynamics, Frailty and Fecundity

A dynamic panel data model of neonatal mortality and birth spacing is analyzed, accounting for causal effects of birth spacing on subsequent mortality and of mortality on the length of the next birth interval, while controlling for unobserved heterogeneity in mortality (frailty) and birth spacing (fecundity). The model is estimated using micro data on almost 30,000 children of 7,300 Indian mothers, for whom a complete retrospective record of fertility and child mortality is available. Information on sterilization is used to identify an equation for completion of family formation that is needed to account for right-censoring in the data. We find clear evidence of frailty, fecundity, and causal effects of birth spacing on mortality and vice versa, but find that birth interval effects can explain only a limited share of the correlation between neonatal mortality of successive children in a family. We also predict the impact of mortality on total fertility. Model simulations suggest that, for every neonatal death, an additional 0.37 children are born, of whom 0.3 survive.fertility, birth spacing, neonatal mortality, health, dynamic panel data models, siblings

Wage structures in the private and public sectors in West Germany

In this paper, we investigate pay structures in the private and public sectors for West Germany. We commence by describing some basic features of the public sector. We use micro-data from the German Socio-Economic Panel for the years 1984-93 to analyse developments and differences in public and private sector wage distributions for both males and females. We break wages down into different education groups and age-groups, and use regressions to construct conditional wage differentials. Our results differ in many aspects from findings for the UK. For instance, we find that although mean wages are higher in the public sector for both males and females, conditional wages are higher in the private sector for all education groups for males, but higher in the public sector for females.

Birth Spacing and Neonatal Mortality in India: Dynamics, Frailty and Fecundity

A dynamic panel data model of neonatal mortality and birth spacing is analyzed, accounting for causal effects of birth spacing on subsequent mortality and of mortality on the next birth interval, while controlling for unobserved heterogeneity in mortality (frailty) and birth spacing (fecundity). The model is estimated using micro data on about 30000 children of 7000 Indian mothers, for whom a complete retrospective record of fertility and child mortality is available. Information on sterilization is used to identify an equation for completion of family formation that is needed to account for right-censoring in the data. We find clear evidence of frailty, fecundity, and causal effects of birth spacing on mortality and vice versa, but find that birth interval effects can explain only a limited share of the correlation between neonatal mortality of successive children in a family.fertility, birth spacing, childhood mortality, health, dynamic panel data models, siblings.

The Future of Retirement and the Pension System: How the Public's Expectations Vary over Time and across Socio-Economic Groups

We analyze expectations of the Dutch population of ages 25 and older concerning the future generosity state and occupational pensions, the two main pillars of the Dutch pension system. Since the summer of 2006, monthly survey data were collected on the expectations of Dutch households concerning purchasing power of occupational pensions, eligibility and purchasing power of old age social security benefits, and the average retirement age ten or twenty years from now. We investigate how these expectations have changed over time and how they vary with socio-economic characteristics. Exploiting the fact that we have data until September 2010, we also analyze the effect of the recent financial and economic crisis. We find significant differences in expectations of different socio-economic groups, mainly suggesting that groups who are probably better informed were also more pessimistic.subjective probabilities, old age social security, occupational pensions

How did the Elimination of the Earnings Test above the Normal Retirement Age affect Retirement Expectations?

We look at the effect of the 2000 repeal of the earnings test above the normal retirement age on retirement expectations of workers in the Health and Retirement Study, aged 51 to 61 in 1992. For men, we find that those whose marginal wage rate increased when the earnings test was repealed, had the largest increase in the probability to work full-time past normal retirement age. We do not find significant evidence of effects of the repeal of the earnings test on the probability to work past age 62 or the expected claiming age. On the other hand, for those reaching the normal retirement age, deviations between the age at which Social Security benefits are actually claimed and the previously reported expected age are more negative in 2000 than in 1998. Since our calculations show that the tax introduced by the earnings test was small when accounting for actuarial benefit adjustments and differential mortality, our results suggest that although male workers form expectations in a way consistent with forward-looking behavior, they misperceive the complicated rules of the earnings test. Results for females suggest similar patterns but estimates are imprecise.social security earnings test, expectations, retirement, difference in differences, panel data