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Measuring income of the aged in household surveys: evidence from linked administrative records

Published online by Cambridge University Press:  19 November 2024

Irena Dushi ,
Brad Trenkamp ,
Charles Adam Bee  and
Joshua W. Mitchell
Irena Dushi*
Affiliation:
Office of Research Evaluation and Statistics (ORES), US Social Security Administration, Washington, DC, USA
Brad Trenkamp
Affiliation:
Office of Research Evaluation and Statistics (ORES), US Social Security Administration, Washington, DC, USA
Charles Adam Bee
Affiliation:
Social, Economic, and Housing Statistics Division, US Census Bureau, Washington, DC, USA
Joshua W. Mitchell
Affiliation:
Center for Economic Studies, US Census Bureau, Washington, DC, USA
*
Corresponding author: Irena Dushi; Email: [email protected]
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Abstract

Household survey estimates of retirement income suffer from substantial underreporting which biases downward measures of elderly financial well-being. Using data from both the 2016 Current Population Survey Annual Social and Economic Supplement (CPS ASEC) and the Health and Retirement Study (HRS), matched with administrative records, we examine to what extent underreporting of retirement income affects key statistics: elderly reliance on social security benefits and poverty. We find that retirement income is underreported in both the CPS ASEC and the HRS. Consequently, the relative importance of social security income remains overstated – 53 percent of elderly beneficiaries in the CPS ASEC and 49 percent in the HRS rely on social security for the majority of their incomes compared to 42 percent in the administrative data. The elderly poverty rate is also overstated – 8.8 percent in the CPS ASEC and 7.4 percent in the HRS compared to 6.4 percent in the administrative data.

Keywords

elderly povertyhousehold surveysmeasurement errorretirement incomesocial securityH31H55I32J14J26
Type
Article
Information
Journal of Pension Economics & Finance , Volume 24 , Issue 1: 20th Anniversary Special Issue of the Journal of Pension Economics and Finance , January 2025 , pp. 95 - 122
Copyright
Copyright © Social Security Administration and The Census Bureau, 2024. To the extent this is a work of the US Government, it is not subject to copyright protection within the United States. Published by Cambridge University Press

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