Current Issues in Economics and Finance

Social Security and the Consumer Price Index for the Elderly

May 2003Volume 9, Number 5
JEL classification: J14, E31

Authors: Bart Hobijn and David Lagakos

Some argue that social security benefits should be adjusted using a price index that reflects the spending habits of the elderly rather than those of workers. This study suggests that if such an index were adopted today, over the next forty years benefit levels would increase and the social security trust fund could become insolvent up to five years sooner than projected.

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