Social Security and Retirement across the OECD

Employment to population ratios differ markedly across OECD countries relative to rates in the U.S., especially for persons aged 55-69. Social security features also differ across the OECD, particularly with respect to replacement rates, entitlement ages and earnings tests. I conjecture that differences in social security features explain many differences in employment to population ratios at older ages. I assess my conjecture quantitatively with a life cycle general equilibrium model of retirement. At ages 60-64 the correlation between my model’s simulations and observed data is about two thirds. The replacement rate and the earnings test explain 90% of observed variability, implying that differences in entitlement ages do not explain differences in employment to population rates at older ages.