This project will be a study of the dynamics of retirement-related labor market behavior of older individuals and couples. Most previous research on retirement-related labor market behavior has examined the determinants of age of retirement of men in a static context; that is, treating retirement as a one-time. Permanent change in labor market status from full-time work to no work. Some studies have acknowledged the importance of """"""""partial retirement"""""""" by including it as a separate labor market status. However, there has been very little research on the determinants and patterns of flows of older individuals into and out of full-time employment, partial retirement, and full retirement. And there has been virtually no research on the determinants and patterns of interrelated retirement decisions of married couples. This study will use data from the Retirement History Survey (RHS) to estimate dynamic models of the retirement-related labor market behavior of older individuals and couples. Both reduced form and structural models of labor market flows will be analyzed. The effects of key determinants such as Social Security benefit amount, pension coverage, wage rates, health, and assets on the rate at which individuals and couples move among different labor market states will be estimated. The NBS provides a unique source of data permitting the construction of precise event histories for older individuals and couples for use in analyzing retirement behavior. This study will be the first to analyze and estimate structural models of the dynamics of retirement-related labor market flows, in which hypotheses concerning the specific channels through which key determinants affect these flows can be tested. It will also be unique in providing the first detailed analysis of the determinants and patterns of interrelated retirement decisions of couples. The estimated models can be used to simulate the effects of alternative changes in the Social Security system on the behavior of older individuals, thus making the results of the study of considerable relevance for policy purposes.
