The secular behavior of aggregate retirement flows

Summary and Conclusions This paper has presented estimated time-series of retirement flows from the labor force for men and women aged 55–64 and 65 and over. These results are a useful addition to labor force participation rates as a means of studying secular trends of aggregate labor market behavior of older workers. Because retirement rates are independent of people who have not been in the labor force, they are better suited to secular studies of aggregate retirement behavior than are labor force participation rates. These estimated time-series have been used to look for aggregate influences on the rates of retirement from the labor force over the period 1948–1977. While there are some tentative indications that macroeconomic conditions affect retirement flows, the important results concern the influence of Social Security retirement benefits. The results reported here clearly indicate that increased coverage and benefits have tended to increase retirement rates over the sample period. Elasticity estimates are large enough to suggest that the older labor force responds at a significant rate to changes in the Social Security program. This research was supported by Social Security Administration Grant No. 10-P-90543-4-02. The author is indebted to Robert Clark and Paul Johnson for support and criticism. Steve Gohmann provided greatly appreciated research assistance.