Key Findings Details
Retirement in a Life Cycle Model of Labor Supply with Home Production
Richard Rogerson and Johanna Wallenius
- A theory of retirement is needed to assess budgetary implications of Social Security reforms.
- Models of retirement imply large labor supply responses to changes in the design of Social Security, but are not consistent with data on labor supply and wages.
- Home production time increases by only a small amount at retirement.
- We show that changes in home production time at retirement are an important element in assessing theories of retirement.