but gradually, and the process of retirement may take some time. In addition, retirement may not be an absorbing state (Banks and Smith, 2006). Third, the retirement decision may be jointly made by a married couple (Gustman and Steinmeier, 2009). If this is the case, retirement behavior needs to be considered as an outcome of intrahousehold decision-making, in addition to a variety of factors including socioeconomic, health, and other circumstances.
In this chapter, we will describe Japanese workers’ retirement processes using the Japanese Study on Aging and Retirement (JSTAR). JSTAR, for the first time, provides publicly available panel data on individuals who were between the ages of 50-75 in 2007. To our knowledge, this study is the first to explore the retirement process in Japan using panel data. Thus, the contribution of this study is to provide new evidence on the process uncovered by JSTAR.
While research on retirement in Japan has been accumulated, the studies are limited in two ways.2 First, the studies use cross-sectional data, which makes it impossible to uncover a retirement “process.” Second, the studies use data sets with a very limited variety of variables. In particular do they contain family demographics, such as spouses’ work status or if they have elderly or other dependents?3
JSTAR, a sister survey of the Health and Retirement Study (HRS), English Longitudinal Survey on Ageing (ELSA), and Survey on Health, Ageing and Retirement in Europe (SHARE), overcomes those two obsta-
2 Research carried out in Japanese workers’ retirement behavior is largely limited to two areas: the labor supply effect of social security earnings test and the effect of mandatory retirement on the transition from a primary job to a secondary job.
3 Some existing surveys are often used in analysis of aging in Japan. The National Survey of Family Income and Expenditure collects data every five years on a wide variety of economic variables and family demographics but less information on health. The Comprehensive Survey of People’s Living Conditions is implemented every three years with small-scale surveys in between years to collect rich information on health, family, and some economic variables. The Survey on Employment of the Elderly focused on working conditions and experience of the elderly between 55 and 69 but ended in 2004. Those surveys are large but cross-sectional. On the other hand, there are three panel data sets on elderly people. The National Long-run Panel Survey on the Life and Health of the Elderly started in 1987 and collects data every three years, which is a Japanese version of AHEAD. Together with the Nihon University Japanese Longitudinal Study of Aging, these surveys provide detailed information on the health status of the elderly aged 60 (or 65) and older and less information on economic status. Thus, the retirement process is not captured well. Lastly, the Ministry of Health, Labour, and Welfare started a panel survey of the senior population (Chukonen Jyudan Chosa), tracking individuals in their 50s in 2007 every two years. The sample size is larger than that of JSTAR with nationwide regions, but the information is insufficient to capture precise amounts of pension income or medical/long-term care expenses. It also lacks data on previous working experiences or future expectations. In most cases, microdata are not accessible or only limitedly accessible.