Working Paper

1. Social Security and the Distribution of Effective Retirement Incentives
   Abstract

   This paper asks how much does Social Security transform a common payroll-tax reform into different effective labor wedges across older workers, and how much do those wedge differences change retirement behavior? Standard policy analysis often treats payroll-tax changes as uniform incentive shifts, but for seniors the relevant object is not the statutory tax rate itself. It is the effective wedge on work after the benefit formula, claiming rules, and the Retirement Earnings Test are taken into account. Exploiting the 2011-2012 U.S. payroll-tax holiday with monthly SIPP data on workers ages 62-70, we find that retirement responses vary systematically with baseline tax exposure, claiming status, and the strength of marginal benefit accrual. Already-claimed workers respond most, consistent with facing a near-pure tax. A dynamic retirement model calibrated to pre-reform moments shows that the Retirement Earnings Test is a major barrier to pre-FRA work, and that benefit linkage sustains late-career employment. The policy incidence of payroll-tax reform for seniors depends on workers' institutional position within Social Security, not just on the statutory rate.

Work in Progress

1. Precautionary Retirement
   Abstract

   With Social Security's trust fund facing depletion, this paper studies how the system's regressive payroll tax shapes labor supply and retirement decisions, motivated by an observation that high-income older males work more and longer. We develop a tractable labor supply model with heterogeneous work-costs, demonstrating that the elasticity of labor supply to financial incentives is inherently distributional. High-income workers, further from retirement cutoff, primarily adjust their hours on the intensive margin, while those with higher work-costs adjust participation on the extensive margin. Our central contribution is the measurement of these income group-specific elasticities, providing a framework to evaluate the distributional effects of policy reforms. We find seniors are 1.71 more elastic than the prime-age workers, implying that raising payroll tax rates may not resolve the solvency of Social Security.

2. Ambiguity Aversion and Fertility Decisions
   Abstract

   This paper investigates how ambiguity aversion affects fertility decisions, considering the uncertainty surrounding the benefits of parenthood. We extend the Becker and Barro (1988) fertility model by incorporating ambiguity aversion to capture parents' decision-making process accurately. We assume that individuals care about their own and children's well-being and face ambiguity about their children's future abilities. Using a multiple priors utility framework, we model parents' preferences as maximizing their minimum expected utility of descendants, focusing on the worst-case scenario for their child's ability. Our findings suggest that more ambiguity-averse parents tend to have fewer children, as they emphasize the lowest possible outcome. This insight helps explain declining fertility rates and rising childlessness in developed countries, as individuals prioritize predictable outcomes over uncertain returns of parenthood.