Supplemental security income, labor supply, and migration

The Supplemental Security Income (SSI) program in the USA creates incentives for potential aged recipients to reduce labor supply prior to becoming eligible, and past research finds evidence of such behavior for older men. There may be a migration response to across-state variation in SSI benefits, which is of interest in its own right and can bias estimates of the effects of SSI benefits on labor supply. We fail to find evidence that older individuals migrate in response to SSI benefits, or that the labor supply disincentive effects of SSI are spurious and instead reflect migration behavior.The author Neumark is also a Senior Fellow at the Public Policy Institute of California, a Research Associate of the National Bureau of Economic Research, and a Research Fellow at Institute for the Study of Labor. The views expressed are not those of the Public Policy Institute of California.