Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/71472
Authors: 
Smith, Sarah
Year of Publication: 
2004
Series/Report no.: 
IFS Working Papers, Institute for Fiscal Studies (IFS) 04/07
Abstract: 
This paper uses UK panel data to shed further light on the fall in spending at retirement (the “retirement-consumption puzzle”). It compares the profiles of spending and well-being at retirement for different groups, defined according to whether retirement is voluntary or involuntary. Where retirement is voluntary, food spending and individual well-being are largely smoothed through retirement; where retirement is involuntary, both food spending and well-being fall. This is consistent with the retirement consumption puzzle being linked to negative wealth shocks. However, there remains one group for whom retirement appears to be voluntary, yet whose spending falls. Fully resolving the puzzle requires a better understanding of how the nature of retirement links to spending and of how different groups substitute leisure for consumption.
Subjects: 
Retirement spending
panel data
JEL: 
D91
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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