Monday, January 23, 2017

Upcoming event: “Improving opportunity for people with disabilities: Understanding trends and effective return-to-work strategies”

Improving opportunity for people with disabilities: Understanding trends and effective return-to-work strategies
Tuesday, February 7, 2017 | 12:30–2:30 PM
AEI, Auditorium | 1789 Massachusetts Avenue, NW | Washington, DC 20036

What role does disability and illness play in declining rates of work? How can public policy better help Americans with disabilities or illness return to work? Join AEI for a discussion of this challenge with top academic researchers and practitioners.

RSVP Watch Live Online


With increasing public attention on declining labor force participation, particularly among prime-age men, health impairments that make working difficult and government disability programs that discourage it have become top issues to consider. What role do disabilities and poor health play? How can public policy better help Americans with disabilities experience the dignity of work and move up the economic ladder?
Join AEI for two panels exploring these questions in depth. First, top academic researchers in the field of labor force participation, disability assistance programs, and the health and well-being of the labor force will discuss their work. A panel of practitioners will follow to discuss their efforts to support people with disabilities or other health issues to remain or rejoin the labor market.  
Join the conversation on social media with @AEI on Twitter and Facebook.


Richard V. Burkhauser, Cornell University
Anne Case, Princeton University
Grant Collins, Fedcap Rehabilitation Services
David D’Arcangelo, Massachusetts Office on Disability
Robert Doar, AEI
Nicholas Eberstadt, AEI
Angela Rachidi, AEI
Scott Winship, The Foundation for Research on Equal Opportunity
Allison Wohl, Association of People Supporting Employment First


RSVP to attend this event.
To watch live online, click here on February 7 at 12:30 PM ET. Registration is not required.


For more information, please contact Nicole Noyes at, 202.862.7197.
For media inquiries or to register a camera crew, please contact, 202.862.5829.

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New paper: "Would Reducing the Price of Employing an Older Worker Improve Labor Market Outcomes by Socioeconomic Status? Evidence from Health Insurance Premium Restrictions"

"Would Reducing the Price of Employing an Older Worker Improve Labor Market Outcomes by Socioeconomic Status? Evidence from Health Insurance Premium Restrictions"
CRR WP No. 2016-17

MATTHEW S. RUTLEDGE, Boston College, Center for Retirement Research
CAROLINE V. CRAWFORD, Boston College - Center for Retirement Research

Delaying retirement improves retirement preparedness, but older workers cannot work longer if employers do not hire or retain them. This study examines one way in which public policy potentially makes older workers more attractive to employers: state regulatory restrictions on how much employer premiums are permitted to increase at small firms with older, unhealthier workforces. The study uses data from the Current Population Survey from 1989-2013 to compare older individuals’ overall employment, small-firm employment, and earnings in states with varying degrees of premium regulation, and among workers of different educational backgrounds. The analysis shows mixed results. Stronger premium regulations were not effective in increasing employment: employment at small firms, which are most sensitive to premium increases, saw no statistically significant increase, and overall employment for older workers at both large and small firms increased only slightly. The earnings gap between large and small firms is also smaller in states with tighter restrictions, but older workers were not helped appreciably more than younger workers. These results suggest that indirect efforts to lower the price of hiring an older worker are not likely to be effective in improving their job prospects.

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New paper: “Optimal Social Security Claiming Behavior under Lump Sum Incentives: Theory and Evidence”

Optimal Social Security Claiming Behavior under Lump Sum Incentives: Theory and Evidence

by Raimond Maurer, Olivia S. Mitchell, Ralph Rogalla, Tatjana Schimetschek


People who delay claiming Social Security receive higher lifelong benefits upon retirement. We survey individuals on their willingness to delay claiming later, if they could receive a lump sum in lieu of a higher annuity payment. Using a moment-matching approach, we calibrate a lifecycle model tracking observed claiming patterns under current rules and predict optimal claiming outcomes under the lump sum approach. Our model correctly predicts that early claimers under current rules would delay claiming most when offered actuarially fair lump sums, and for lump sums worth 87% as much, claiming ages would still be higher than at present.

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Tuesday, January 17, 2017

Upcoming event: “Trends in Family Wealth, 1989 to 2013”

Guest Speaker
Nadia Karamcheva
"Trends in Family Wealth, 1989 to 2013"
Wednesday, January 18th, 2017
12:00 p.m. - 1:00 p.m.
Cato Institute
1000 Massachusetts Ave NW, Washington, DC 20001

Featured Guest:

Nadia Karamcheva is an economist at the Congressional Budget Office (CBO) in Washington DC. Prior to joining CBO, she worked as a research associate at the Urban Institute. Her research interests span a broad range of topics in labor economics and applied econometrics, with emphasis on retirement and the economics of aging. Her current work explores policy relevant topics related to Social Security, private pension plans, and labor force participation and savings behavior of older adults.

She has a Ph.D. in Economics from Boston College, an M.A. in Economics from the same university and a B.A. in Economics and Business Administration from the American University in Bulgaria.

Nadia Karamcheva
Congressional Budget Office

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Monday, January 16, 2017

New article: “CBO’s Long-Term Projections of Labor Force Participation.”

CBO’s Long-Term Projections of Labor Force Participation

By Joshua Montes, Xiaotong Niu, and Julie Topoleski. January 13, 2017.

This article outlines one of the underlying assumptions for the CBO’s Social Security projections, and explains one reason why CBO projects a larger long-term funding shortfall than do the Social Security trustees.

Check it out here.

Comparison of Adjusted Labor Force Participation Rates, by Sex

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Friday, January 13, 2017

New paper: “The Effects of Collecting Income Taxes on Social Security Benefits”

January 2017, No. 17-02

The Effects of Collecting Income Taxes on Social Security Benefits

John Bailey Jones and Yue Li, Federal Reserve Bank of Richmond

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Since 1983, Social Security benefits have been subject to income taxation, a provision that can significantly increase the marginal income tax rate for older individuals. To assess the impact of this tax, we construct and calibrate a detailed life-cycle model of labor supply, saving, and Social Security claiming. We find that in a long-run stationary environment, replacing the taxation of Social Security benefits with a revenue-equivalent increase in the payroll tax would significantly increase labor supply, consumption and welfare. From an ex-ante perspective an even more desirable reform would be to make the portion of benefits subject to income taxes completely independent of other income.

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A very simple ‘Minimum Benefit’ idea for Social Security

Over at MarketWatch, Alicia Munnell writes of what she calls “a very simple” proposal for a minimum Social Security benefit, something the program currently lacks. The idea is based on a proposal from Steve Sass of the Center for Retirement Research, of which Munnell is the director.

The idea is a little technical, but is worth thinking about. You can read Munnell’s article here.

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