TY  - JOUR
AU  - Feldstein,Martin
TI  - Social Security, Induced Retirement, and Aggregate Capital Accumulation:A Correction and Updating
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 579
PY  - 1982
Y2  - July 1982
UR  - http://www.nber.org/papers/w0579
L1  - http://www.nber.org/papers/w0579.pdf
N1  - Author contact info:
Martin S. Feldstein
President Emeritus
NBER
1050 Massachusetts Avenue
Cambridge, MA  02138-5398
Tel: 617/868-3905
Fax: 617/868-7194
E-Mail: msfeldst@nber.org
AB  - In a 1974 paper in the Journal of Political Economy I discussed the theoretical ambiguity of the effect of social security on private saving and presented statistical evidence that social security does on balance depress saving. Recently, an error was detected in the computer program that was used to construct the "social security wealth" variable. I have now corrected that error and re estimated the original consumer expenditure equation. I have also updated the analysis by including the five years of additional data that have become available since the original study was completed. The new estimates, presented in the current note, continue to indicate that social security substantially depresses private saving. The point estimates of this effect are somewhat lower than before but nevertheless simply that social security depresses saving by about fifty percent of its current value. The estimated reduction in saving is more than two-thirds of the concurrent "contributions" of employees and employers to the social security retirement and survivors fund.
ER  -