The Rise of Retirement Among African Americans: Wealth and Social Security Effects / Dora L. Costa.

Format:

Book

Author/Creator:

Costa, Dora L.

Contributor:

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w14462.

NBER working paper series no. w14462

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

The Rise of Retirement Among African Americans

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2008.

Summary:

I examine the effects of an unearned income transfer on the retirement rates and living arrangements of a very poor population by studying the effects of pensions on the decisions of black Union Army veterans. I find that blacks were 2 to 5 times as responsive as whites to income transfers in their retirement decisions and 6 to 8 times as responsive in their choice of independent living arrangements. I argue that blacks' greater poverty explains their responsiveness to pensions. My findings have implications for understanding racial differences in trends in retirement and independent living. I show that the retirement rates of both blacks and whites rose between 1900 and 1930 but that convergence in black and white rates and in living arrangements only occurred between 1930 and 1950. I argue that income effects from the institution of Social Security explain up to half of the convergence in black-white retirement rates and in living arrangements.

Notes:

Print version record

November 2008.