Long run effects of social security reform prosposals on lifetime progressivity

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National Bureau of Economic Research , Cambridge, MA
Social security -- United States -- Finance -- Econometric models., Social security taxes -- United States -- Econometric models., Progressive taxation -- United States -- Econometric models., Income distribution -- Government policy -- United States -- Econometric mo
Other titlesEffects of social security reform prosposals on lifetime progressivity
StatementJulia Lynn Coronado, Don Fullerton, Thomas Glass.
SeriesNBER working paper series -- working paper 7568, Working paper series (National Bureau of Economic Research) -- working paper no. 7568.
ContributionsFullerton, Don., Glass, Thomas, National Bureau of Economic Research.
The Physical Object
Pagination40, [19] p. :
ID Numbers
Open LibraryOL22398419M

Chicago: The University of Chicago Press, Long-Run Effects of Social Security Reform Proposals on Lifetime Progressivity, Julia Lynn Coronado, Don Fullerton, Thomas Glass. in The Distributional Aspects of Social Security and Social Security Reform, Feldstein and Liebman. Cited by: 5 Long-Run Effects of Social Security Reform Proposals on Lifetime Progressivity; 6 Social Security's Treatment of Postwar Americans; 7.

The Distributional Effects of an Investment-based Social Security System; 8 Distributional Effects in a General Equilibrium Analysis of Social Security; 9 The Economics of Bequests in Pensions and Social Security.

This paper uses a lifetime framework to address questions about the progressivity of social security and proposed reforms. We use a large sample of diverse individuals from the PSID to calculate. The pattern of progressivity is affected by alternative assumptions, but it is Long run effects of social security reform prosposals on lifetime progressivity book in similar ways for the current system and proposed reforms.

None of these reforms greatly alters the current degree of progressivity on a lifetime basis. (This abstract was borrowed from another version of this item.). Long-Run Effects of Social Security Reform Proposals on Lifetime Progressivity Julia Lynn Coronado, Don Fullerton, Thomas Glass Chapter in NBER book The Distributional Aspects of Social Security and Social Security Reform(), Martin Feldstein and Jeffrey B.

Liebman, editors (p. - ) Conference held OctoberCited by: Long run effects of social security reform prosposals on lifetime progressivity.

Cambridge, MA: National Bureau of Economic Research, © (OCoLC) Material Type: Internet resource: Document Type: Book, Internet Resource: All Authors / Contributors: Julia Lynn Coronado; Don Fullerton; Thomas Glass; National Bureau of Economic Research.

Abstract. This paper uses a lifetime framework to address questions about the progressivity of social security and proposed reforms. We use a large sample of diverse individuals from the PSID to calculate lifetime income, to classify individuals into income quintiles, and then to calculate the present value of taxes minus benefits for each person in each group.

A less appealing aspect of the proposal is that it likely would have a disproportionately negative effect on the poor because the longevity gap between the rich and poor in the United States is large and growing, 1 which means that the poor tend to receive fewer years of Social Security benefits than the rich.

Consequently, a one-year increase. Abstract Achieving long-run Social Security solvency requires addressing rising life expectancy. Increasing the Full Retirement Age (FRA), while holding the Early Entitlement Age (EEA) fixed, could be effective but eventually will result in replacement rates that are viewed by many as too low.

This is followed by an examination of proposals for integration of the two through a negative income tax scheme. Long Run Effects of Social Security Reform Proposals on Lifetime Progressivity. Coronado, J., Fullerton, D. and Glass, T. () ‘Long-run effects of social security reform proposals on lifetime progressivity’, in M.

Feldstein and J.B. Liebman (eds) The Distributional Aspects of Social Security and Social Security Reform. Chicago: University of.

Julia Lynn Coronado & Don Fullerton & Thomas Glass, "Long-Run Effects of Social Security Reform Proposals on Lifetime Progressivity," NBER Chapters, in: The Distributional Aspects of Social Security and Social Security Reform, pagesNational Bureau of. Social Security recipients got a % raise forcompared with the % hike beneficiaries received in Maximum earnings subject to the Social Security tax also increased—from $, This chapter explores the way that the inequality of consumption behaves in a life-cycle model without bequests.

It also investigates the consequences of Social Security reform for the inequality of consumption across individuals. Systems in which there is less sharing of earnings risk develop higher consumption inequality both before and after retirement.

Get this from a library. The distributional aspects of social security and social security reform. [Martin S Feldstein; Jeffrey B Liebman;] -- Social security is the largest and perhaps the most popular program run by the federal government.

Given the projected increase in both individual life expectancy and sheer number of retirees. consider their effects on the progressivity of Social Security. Some commonly considered policy options to restore solvency to Social Security may be unfair to people with low life expectancy.

In particular, policies that cut benefits as the way to deal with increasing life expectancy cause the replacement rate to decline over time. The.

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5 Ways to Reform Social Security It sounds like an easy fix—shift money from the wealthiest retirees to the recipients who need it most—but in the long run, the politics of means-testing.

The last 9 Trustees Reports have indicated that Social Security's Old-Age, Survivors, and Disability Insurance (OASDI) Trust Fund reserves would become depleted between and under the intermediate set of assumptions provided in each report. If no legislative change is enacted, scheduled tax revenues will be sufficient to pay only about three-fourths of the scheduled benefits after.

Our three-part proposal would restore long-term balance to Social Security: revenues would be projected to be sufficient for expenditures over. Redistribution in the Current U.S. Social Security System 2. Gauranteed Income: SSI and the Well-Being of the Elderly Poor 3. The Impact of Social Security and Other Factors on the Distribution of Wealth 4.

Social Security and Inequality over the Life Cycle 5. Long-Run Effects of Social Security Reform Proposals on Lifetime Progressivity 6. The Social Security proposal from the co-chairs of President Obama’s fiscal commission is not a suitable starting point, let alone a reasonable outcome, for Social Security reform because it relies far too much on deep benefit cuts to restore solvency to the program and makes a number of harmful Social Security proposal that the co-chairs — former Clinton White.

lifetime earnings. We also take a lifetime perspective, showing for each option the effect on payout (the ratio of lifetime benefits to contributions) by lifetime earnings.

Effects on Social Security Solvency • The COLA cut and the PPI proposal would both substantially reduce Social Security’s year. SOCIAL SECURITY REFORM. To reduce Social Security’s projected funding shortfall, the commission would increase the taxable wage base by to include 90 percent of earnings, increase the full- and early-retirement ages to 69 respectively, bycover newly hired state and local workers afterand create a hardship exemption.

After 75 years, indexing Social Security for longevity would reduce the annual deficit between benefits and taxes quite significantly, from about one-third to one-half depending upon the proposal.

This paper reports on the status of a long-run simulation model of the U.S. economy and its relationships with the Social Security program that was designed with these considerations in mind.

The model was developed specifically to analyze the potential equity and efficiency effects of alternative Social Security policies in a long-run context.

Among the far-reaching effects of Social Security reform on the rest of the economy is the impact on private pensions.

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This paper develops a model of pension plan design that incorporates heterogeneity in tastes for saving and sorting of workers in the labor market. The model is used to analyze the likely effects of a range of Social Security reform proposals on the design of.

The Social Security Reform Act ofintroduced by Rep. Sam Johnson, R-Texas, presents a reasonable, targeted, and fiscally responsible approach to begin reforming Social Security.

Abstract. Purpose: The potential effects of implementing three different minimum benefits in Social Security, which have accompanied proposals to privatize the program and reform family benefits, are examined in relation to the adequacy of benefits for women reaching age 62 between and Design and Methods: The Health and Retirement Study is used to conduct a simplified.

The CBO reported in July the effects of a series of policy options on the "actuarial balance" shortfall, which over the 75 year horizon is approximately % of GDP. Social Security is facing a long-run shortfall of approximately 1% GDP per year or $ billion/year in dollars.

Key reform proposals include. Increased longevity and social security reform: greater progressivity results in less lifetime inequlity but also less growth.

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and Zhang, J. () Long-run effects of unfunded social security with earnings-dependent benefits. Social security systems have a number of macroeconomic effects that are absent in other forms of social insurance programs such as health insurance. Of particular importance is the effect of social security on the rate of saving in the economy, and thus on the rate of investment and long-run.

The challenge of Social Security reform is to close the long-term funding shortfall, while protecting the people of low and average means whose economic security depends on Social Security benefits, and adjusting the program to fit the changing conditions of American life.

it can make deep long-run cuts while sparing current beneficiaries.Reform Proposals Unlike many other Social Security reform proposals, the Personal Security System would substantially alleviate the long-run fiscal crisis facing future genera-tions. It would also improve economic efficiency by linking retirement income to retirement saving without sacrificing secondary earners and the poor.

THE CHALLENGE.