Arbeitspapier
Making Disability Work? The Effects of Financial Incentives on Partially Disabled Workers
This study provides insight in the responsiveness of disabled workers to financial incentives, using administrative individual data from the Netherlands from 2006 to 2013. We focus on workers receiving partial DI benefits and with substantial residual work capacities that can be exploited. After the first phase of benefit entitlement, workers that do not use their residual income capacity experience a large drop in benefit income. In effect, this implies a substantial increase in incentives to resume work. With entitlement periods in the first phase of DI benefits varying across individuals, we use a difference-in-difference approach to analyze the effects on the incidence of work, the wage earnings and full work resumption of disabled workers. Based on the effect estimate on work incidence, we infer a labor elasticity rate of 0.12. Elasticity estimates are highest among younger DI recipients, as well as individuals with mental impairments. The incentive change has only a limited impact on wage earnings of partially disabled workers and no significant impact on work resumption rates.
- Language
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Englisch
- Bibliographic citation
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Series: IZA Discussion Papers ; No. 9624
- Classification
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Wirtschaft
Model Evaluation, Validation, and Selection
National Government Expenditures and Welfare Programs
- Subject
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disability insurance
work incentives
- Event
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Geistige Schöpfung
- (who)
-
Koning, Pierre
van Sonsbeek, Jan-Maarten
- Event
-
Veröffentlichung
- (who)
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Institute for the Study of Labor (IZA)
- (where)
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Bonn
- (when)
-
2016
- Handle
- Last update
-
10.03.2025, 11:44 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Koning, Pierre
- van Sonsbeek, Jan-Maarten
- Institute for the Study of Labor (IZA)
Time of origin
- 2016
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