The Effect of Disability on Labour Market Outcomes in Germany: Evidence from Matching

Michael Lechner and Rosalia Vazquez-Alvarez

No 967, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: If labour market policies aimed at people with disabilities are effective, we should observe no significant difference in labour market outcomes between disable and non-disable individuals. This paper examines the impact of disability status on labour market outcomes using matching methods associated with treatment effect techniques for program evaluation. Such techniques are fairly robust with respect to model misspecification and account for the common support problem, thus improving the identification and estimation strategy. Using the German Socio Economic Panel (1984-2001) we estimate the impact of disability on labour market participation and different income measures. We find that those who are not disable experience higher employment rates and higher earnings relative to those who have become disable. This difference is almost always significant for all labour market outcomes considered.

Keywords: treatment effect; evaluation of disability policies; health status; causality; matching on the propensity score; labour market outcomes (search for similar items in EconPapers)
JEL-codes: C13 C14 I12 I18 J23 (search for similar items in EconPapers)
Pages: 76 pages
Date: 2003-12
New Economics Papers: this item is included in nep-edu, nep-eec and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22)

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Related works:
Working Paper: The Effect of Disability on Labour Market Outcomes in Germany: Evidence from Matching (2004)
Working Paper: The Effect of Disability on Labour Market Outcomes in Germany: Evidence from Matching (2003)
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