Intergenerational Time Transfers and Social Security Eligibility: Evidence from a Regression Discontinuity Design

Abstract

We examine whether grandparents' eligibility for early Social Security retirement benefits at age 62 affects labor supply patterns in multigenerational households. Using American Community Survey data from 2019–2022 and a regression discontinuity design, we test two hypotheses: (1) whether grandparents reduce work hours discontinuously upon reaching age 62, and (2) whether this reduction creates "spillover" effects on the labor supply of co-resident working-age parents through increased grandparent-provided childcare. We find no evidence of a discrete change in grandparent work hours at the 62 threshold, despite observing a smooth and substantial decline in hours across the 58–66 age range. Similarly, we find no evidence of intergenerational spillover effects on parent labor supply. These null results suggest that Social Security early eligibility does not create sharp behavioral responses in multigenerational households, and that retirement transitions in this context are gradual rather than discontinuous. Our findings have implications for the design of retirement policy and for understanding intergenerational time allocation. \vspace{0.5em} JEL Codes: J22, J26, H55, D13 Keywords: Social Security, retirement, labor supply, intergenerational transfers, regression discontinuity