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The Retirement Consumption Puzzle in China†.

Authors :
Li, Hongbin
Shi, Xinzheng
Wu, Binzhen
Source :
American Economic Review; May2015, Vol. 105 Issue 5, p437-441, 5p, 4 Charts
Publication Year :
2015

Abstract

Using data from China's Urban Household Survey and exploiting China's mandatory retirement policy, we use the regression discontinuity approach to estimate the impact of retirement on household expenditures. Retirement reduces total non-durable expenditures by 20 percent. Among the categories of non-durable expenditures, retirement reduces work-related expenditures and expenditures on food consumed at home but has an insignificant effect on entertainment expenditures. After excluding these three components, retirement does not have an effect on the remaining non-durable expenditures. It suggests that the retirement consumption puzzle might not be a puzzle if a life-cycle model with home production is considered. [ABSTRACT FROM AUTHOR]

Details

Language :
English
ISSN :
00028282
Volume :
105
Issue :
5
Database :
Complementary Index
Journal :
American Economic Review
Publication Type :
Academic Journal
Accession number :
102579686
Full Text :
https://doi.org/10.1257/aer.p20151007