Stated Preference Analysis of Full and Partial Retirement in the United States

30 Pages Posted: 15 Nov 2013

See all articles by Tunga Kantarcı

Tunga Kantarcı

Tilburg University

Arthur van Soest

Tilburg University; Netspar; RAND Corporation; Institute for the Study of Labor (IZA)

Multiple version iconThere are 2 versions of this paper

Date Written: October 11, 2013

Abstract

In the traditional retirement scenario, individuals work full-time until a given age and then stop working abruptly. In the alternative partial retirement scenario, individuals work part-time for several years before they stop working. For the individual, partial retirement provides a smooth transition to full-retirement where they gradually adjust to a possibly lower income and more leisure time in full-retirement, and for the economy, it is a potential policy tool to keep people employed longer. The models developed to explain the retirement decisions of older workers are typically estimated using data on actual retirement behavior, from which it is difficult to identify the retirement options available to employees. In particular, employers often do not provide partial retirement opportunities. In this paper, we use stated preference data to identify the preferences of individuals for full and partial retirement plans. We consider a choice set of hypothetical full and partial retirement plans and ask the respondents of a survey representative for the US population of ages 40 and over to choose their favorite plan. We analyze how the choices vary with financial incentives and other factors.

Keywords: Older workers, gradual retirement, field experiment

JEL Classification: C35, C93, D04, D91, J14, J22, J26

Suggested Citation

Kantarcı, Tunga and van Soest, Arthur H. O. and van Soest, Arthur H. O., Stated Preference Analysis of Full and Partial Retirement in the United States (October 11, 2013). CESR-Schaeffer Working Paper No. 2013-011, Available at SSRN: https://ssrn.com/abstract=2354646 or http://dx.doi.org/10.2139/ssrn.2354646

Tunga Kantarcı (Contact Author)

Tilburg University ( email )

P.O. Box 90153
Tilburg, DC Noord-Brabant 5000 LE
Netherlands

Arthur H. O. van Soest

Tilburg University ( email )

P.O. Box 90153
Tilburg, DC Noord-Brabant 5000 LE
Netherlands

Netspar

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

RAND Corporation ( email )

P.O. Box 2138
1776 Main Street
Santa Monica, CA 90407-2138
United States

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

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