TY  - JOUR
AU  - Mulligan,Casey B.
AU  - Sala-i-Martin,Xavier
TI  - Social Security, Retirement, and the Single-Mindedness of the Electorate
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 9691
PY  - 2003
Y2  - May 2003
UR  - http://www.nber.org/papers/w9691
L1  - http://www.nber.org/papers/w9691.pdf
N1  - Author contact info:
Casey B. Mulligan
University of Chicago
Department of Economics
1126 East 59th Street
Chicago, IL  60637
Tel: 773/702-9017
Fax: 773/702-8490
E-Mail: c-mulligan@uchicago.edu

Xavier Sala-i-Martin
Department of Economics
Columbia University
420 West 118th Street, 1005
New York, NY 10027
Tel: 212/854-7055
Fax: 212/854-8059
E-Mail: xs23@columbia.edu
AB  - We propose a positive theory that is consistent with two important features of social security programs around the world: (1) they redistribute income from young to old and (2) they induce retirement. We construct a voting model that includes a political campaign' or  debate' prior to the election. The model incorporates  single-mindedness' of the groups that do not work: while the workers divide their political capital between their age concerns' and  occupational concerns', the retired concentrate all their political capital to support their age group. In our model, the elderly end up getting transfers from the government (paid by the young) and distortionary labor income taxes induce the retirement of the elderly. In addition, our model predicts that occupational groups that work more will tend to have more political power. The opposite is true for non-occupational groups (such as the elderly). We provide some evidence that supports these additional predictions.
ER  -