Financial incentives and retirement: evidence from federal civil service workers

We examine the retirement behavior of federal civil service workers employed by the Department of Defense. These workers provide an interesting population for studying retirement because they face relatively simple financial incentives, high quality administrative data are available, and they are not covered by the Social Security system. We find that these workers respond to their financial incentives in a similar manner to what others have found when analyzing much different retirement systems. We also find no evidence of "excess retirement" at key ages of the Social Security system, which does not support the existence of societal-wide norms regarding retirement. (C) 2004 Elsevier B.V. All rights reserved.