Tag: state and local
Abstract Federal law allows certain state and local government employees to be excluded from Social Security if they are covered by an employer pension of sufficient generosity. As a result, approximately one-quarter of state and local workers are not covered by Social Security on their current job. Before COVID-19, these “FICA replacement plans” all satisfied…
But evidence from state and local workers suggests that doesn’t always happen. The economist’s simple lifecycle model predicts that workers will respond to a one-dollar decrease in their defined benefit savings by increasing their supplemental savings by one dollar. Whether this prediction holds in practice may turn out to be very important for state and…
