Women and the equity of the social security program

Abstract

Over the past decade there has been a keen interest in the relative treatment of women and men under Social Security. There is a general consensus that the program contains de facto discrimination against certain identifiable groups, such as marketworking women, two-earner married couples, and single persons. To clarify the equity issues surrounding the Social Security program, this article begins with a brief historical review of the program, emphasizing statutory provisions affecting the equitable treatment of men and women, followed by a descriptive analysis of the distributional impact of the Social Security program. Equity implications are examined under two within-household property ownership rules: one is the individually owned benefit rule, where benefit ownership rights within the family unit are exclusively assigned to the individual who incurred the old age insurance (OAI) tax liability; the other is the community-owned benefit rule, where benefit ownership rights are assumed to be equally owned by the husband and wife, independent of who incurred the OAI tax liability. The analysis of 3,141 Social Security beneficiaries who retired between 1962 and 1972 uses an annuity-welfare model of the Social Security program. It reveals that conclusions regarding the differential treatment of women and men depend on the within-household property rights assumption underpinning the distribution of earned retirement benefits within a married household.