Pension Enhancements and Teacher Retirement Behavior
Working Paper Number:
We examine how pension rule changes a ect teacher retirement by estimating a structural retirement model on a large cohort of late career Missouri public school teachers. In so
doing we address several statistical challenges that arise in estimating dynamic retirement models. The resulting estimates produce good in and out-of-sample t. Counter-factual
simulations suggest that Missouri's 1990s pension enhancements led to earlier retirement by about 0.4 years on average for the 1994 cohort and by more than one year in a steady state.
Enhancements increased steady state pension liabilities by 16 percent for senior teachers.