The Effect of Disability Insurance Receipt on Labor Supply

Eric French and Jae Song ()

American Economic Journal: Economic Policy, 2014, vol. 6, issue 2, 291-337

Abstract: 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.

JEL-codes: H55 J14 J22 K23 (search for similar items in EconPapers)
Date: 2014
Note: DOI: 10.1257/pol.6.2.291
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Citations: View citations in EconPapers (158)

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Related works:
Working Paper: The effect of disability insurance receipt on labor supply (2009)
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