Retiree Health Benefits and the Decision to Retire

TitleRetiree Health Benefits and the Decision to Retire
Publication TypeReport
Year of Publication2009
AuthorsMarton, J, Woodbury, SA
InstitutionKalamazoo, MI, W.E. Upjohn Institute for Employment Research, Staff Working Papers: 09-149
Call Numbernewpubs20090908_09-149.pdf
KeywordsEmployment and Labor Force, Medicare/Medicaid/Health Insurance, Retirement Planning and Satisfaction
Abstract

We estimate the effect of employer offers of retiree health benefits (RHBs) on the timing of retirement using a sample of men observed over a period of up to 12 years in the Health and Retirement Study (HRS). Our main concern is that such estimates may be contaminated by unobserved heterogeneity - workers with a taste for early retirement sort into jobs offering RHBs. We attempt to address this concern by using a fixed-effects estimator, which yields substantially smaller estimates of the effect of RHB offers than estimators that do not attempt to control for unobservables. The findings suggest that an RHB offer increased the probability of retirement by 14 percent on average for men born between 1931 and 1941.

Endnote Keywords

Health Insurance Coverage/Employer contributions/Retirement Behavior

Endnote ID

20540

Citation Key5741