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The Employment Effects of the Social Security Earnings Test

The Employment Effects of the Social Security Earnings Test <p>ABSTRACT:</p><p>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.</p> http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Human Resources University of Wisconsin Press

The Employment Effects of the Social Security Earnings Test

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Publisher
University of Wisconsin Press
Copyright
Copyright © Board of Regents of the University of Wisconsin System
ISSN
1548-8004

Abstract

<p>ABSTRACT:</p><p>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.</p>

Journal

Journal of Human ResourcesUniversity of Wisconsin Press

Published: Mar 3, 2022

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