No Excuse for No Retirement

Dan Hamermesh wrote recently that he doesn’t feel sorry for would-be retirees who lost their savings by bad asset allocation. Boston University economics professor Laurence Kotlikoff thinks people aren’t capable of predicting how much they’ll need to save in the first place. So he has developed a “consumption smoothing” program that helps users maintain stable […]

No Sympathy for Would-Be Retirees

A 60 Minutes segment on Sunday presented sad stories about people in their 50’s and early 60’s who had counted on their 401K plans to provide a comfortable retirement income by age 65 or even earlier, but who have had their dreams destroyed by the stock market bust. Anyone born in the 1940’s or 1950’s […]

I Turn Old Today

Dan and his wife in 1966. Back to Bismarck! Today I am officially old (by definition of the U.S. Census Bureau). As an economist, I am “hung up” on this age. Why? Because the life-cycle theories of utility maximization that describe patterns of consumption are based on a retirement age; and 65 was enshrined as […]

Flexibility in the Final Hour

Photo: Rhett Redelings The general rule that we tell students is that people should work until the pleasure of earnings from the last hour of work falls below the hardship imposed by that marginal hour. In many cases, though, we unfortunately can’t make choices about that marginal hour. Our 63-year-old friend, a specialist in pediatric […]