Harsh occupations, health status and social security

Pierre Pestieau and Maria Racionero

No 2013001, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: We study the optimal design of a social security system when individuals differ in health status and occupation. Health status is private information but is imperfectly correlated with occupation: individuals in harsh occupations are more likely to be in poor health. We explore the desirability of letting the social security policy differ by occupation and compare the results with those obtained when disability tests are used instead. We show that tagging by occupation is preferable to testing when the audit technology is relatively expensive and/or the proportion of disabled workers differs markedly across occupations. We also study the implications of imposing horizontal equity among disabled workers and show that those in the harsh occupation may be induced to retire later.

Keywords: health status; retirement age; tagging; disability tests (search for similar items in EconPapers)
JEL-codes: H21 H55 (search for similar items in EconPapers)
Date: 2013-02-22
New Economics Papers: this item is included in nep-age, nep-cta, nep-hea and nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Working Paper: Harsh Occupations, Health Status and Social Security (2016)
Working Paper: Harsh occupations, health status and social security (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:cor:louvco:2013001

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