The Effect of Disability Insurance Receipt on Labor Supply

• 成果类型: Article
• 署名作者: French, Eric; Song, Jae
• 署名单位: University of London; University College London; Federal Reserve System - USA; Federal Reserve Bank - Chicago
• 刊物名称: AMERICAN ECONOMIC JOURNAL-ECONOMIC POLICY
• ISSN/ISSBN: 1945-7731
• DOI: 10.1257/pol.6.2.291
• 发表日期: 2014
• 页码: 291-337
• 关键词: instrumental variable estimation; HEALTH; applicants; earnings; models; identification; program; GROWTH; care

摘要

This paper exploits the effectively random assignment of judges to Disability Insurance cases to estimate the causal impact of Disability Insurance receipt on labor supply. We find that benefit receipt reduces labor force participation by 26 percentage points three years after a disability determination decision, although the reduction is smaller for older people, college graduates, and those with mental illness. OLS and instrumental variables estimates are similar. Furthermore, over 60 percent of those denied benefits by an administrative law judge are subsequently allowed benefits within ten years, showing that most applicants apply, reapply, and appeal until they get benefits.