Disability Grant and Individual Labour Force Participation: The Case of South Africa

George Mutasa ()
Additional contact information
George Mutasa: Development Policy Research Unit

Working Papers from University of Cape Town, Development Policy Research Unit

Abstract: Despite the explosive growth in the number of people receiving disability benefits in South Africa, very little is known about the labour supply effects of the disability grant (DG). This study investigates the impact of disability grant receipt on labour force participation. Consideration is given to potential bias that may arise from unobserved confounding factors. The study utilises data drawn from the 2007 wave of the General Household Survey (GHS) and implements a three-step methodology in a comparative perspective. Firstly, a standard probit regression of labour force participation is applied, followed by an instrumental variable regression to correct for possible endogeneity of DG take up. Finally, the sensitivity and robustness of the results is checked by implementing a variety of propensity score matching techniques. The results overall suggest that the DG receipt has substantial work disincentive effects, but the magnitude of the effect differs between parametric and non-parametric estimators.

Keywords: Disability Grant; Labour Force participation; Propensity score (search for similar items in EconPapers)
JEL-codes: H53 J21 J22 J64 J68 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2012-12
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published in Working Paper Series by the Development Policy Research Unit, December 2012, pages 1-33

Downloads: (external link)
http://hdl.handle.net/11427/7299 First version, 2012 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ctw:wpaper:12156

Access Statistics for this paper

More papers in Working Papers from University of Cape Town, Development Policy Research Unit Contact information at EDIRC.
Bibliographic data for series maintained by Waseema Petersen ( this e-mail address is bad, please contact ).