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Pensions and Household Wealth Accumulation

Pensions and Household Wealth Accumulation Abstract: Economists have long suggested that higher private pension benefits "crowd out" other sources of household wealth accumulation. We exploit detailed information on pensions and lifetime earnings for older workers in the 1992 wave of the Health and Retirement Study and employ an instrumental-variable (IV) identification strategy to estimate crowd-out. The IV estimates suggest statistically significant crowd-out: each dollar of pension wealth is associated with a 53-67 cent decline in nonpension wealth. With less precision, we use an instrumental-variable quantile regression estimator and find that most of the effect is concentrated in the upper quantiles of the wealth distribution. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Human Resources University of Wisconsin Press

Pensions and Household Wealth Accumulation

Journal of Human Resources , Volume 46 (1) – Apr 4, 2011

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Publisher
University of Wisconsin Press
Copyright
Copyright © University of Wisconsin Press
ISSN
1548-8004
Publisher site
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Abstract

Abstract: Economists have long suggested that higher private pension benefits "crowd out" other sources of household wealth accumulation. We exploit detailed information on pensions and lifetime earnings for older workers in the 1992 wave of the Health and Retirement Study and employ an instrumental-variable (IV) identification strategy to estimate crowd-out. The IV estimates suggest statistically significant crowd-out: each dollar of pension wealth is associated with a 53-67 cent decline in nonpension wealth. With less precision, we use an instrumental-variable quantile regression estimator and find that most of the effect is concentrated in the upper quantiles of the wealth distribution.

Journal

Journal of Human ResourcesUniversity of Wisconsin Press

Published: Apr 4, 2011

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