Short Summary:
Using PSID data (2007-2015), this paper shows that a rise in stress increases the probability to retire by roughly 15.4 percentage points, while retirement decreases stress by 34.5 percentage points. Results remain similar when disaggregating by individuals’ characteristics, but the former effect is stronger for males, for people working in typical blue-collar jobs, and for people whose wealth is below the mean; while the latter is stronger for males, for white-collar workers, for people whose wealth is above the mean, and for white individuals. Other results show that official retirement ages are a strong instrument for actual retirement age; lagged physical activity levels are a non-linear instrument for perceived stress; and objective measures of mental health are a strong instrument for perceived stress.
Publication Authors: Raquel Fonseca, Hugo Morin et Ana I. Moro-Egido.
Number: 21-03
Year: 2021