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Does Disability Insurance Receipt Discourage Work? Using Examiner Assignment to Estimate Causal Effects of SSDI Receipt

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  • Nicole Maestas
  • Kathleen J. Mullen
  • Alexander Strand
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    Abstract

    We present the first causal estimates of the effect of Social Security Disability Insurance benefit receipt on labor supply using all program applicants. We use administrative data to match applications to disability examiners and exploit variation in examiners' allowance rates as an instrument for benefit receipt. We find that among the estimated 23 percent of applicants on the margin of program entry, employment would have been 28 percentage points higher had they not received benefits. The effect is heterogeneous, ranging from no effect for those with more severe impairments to 50 percentage points for entrants with relatively less severe impairments.

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    Bibliographic Info

    Article provided by American Economic Association in its journal American Economic Review.

    Volume (Year): 103 (2013)
    Issue (Month): 5 (August)
    Pages: 1797-1829

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    Handle: RePEc:aea:aecrev:v:103:y:2013:i:5:p:1797-1829

    Note: DOI: 10.1257/aer.103.5.1797
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    Cited by:
    1. Gordon B. Dahl & Andreas Ravndal Kostøl & Magne Mogstad, 2014. "Family welfare cultures," Discussion Papers, Research Department of Statistics Norway 782, Research Department of Statistics Norway.
    2. Lucie Schmidt, 2013. "The New Safety Net? Supplemental Security Income after Welfare Reform," Department of Economics Working Papers 2013-07, Department of Economics, Williams College.
    3. Chaisemartin, Clément de, 2014. "Tolerating defiance? Local average treatment effects without monotonicity," CAGE Online Working Paper Series, Competitive Advantage in the Global Economy (CAGE) 197, Competitive Advantage in the Global Economy (CAGE).
    4. Laura Salisbury, 2014. "Women's Income and Marriage Markets in the United States: Evidence from the Civil War Pension," NBER Working Papers 20201, National Bureau of Economic Research, Inc.
    5. Timothy J. Moore, 2014. "The Employment Effect of Terminating Disability Benefits," NBER Working Papers 19793, National Bureau of Economic Research, Inc.
    6. Yonatan Ben-Shalom & Arif A. Mamun, 2013. "Return-to-Work Outcomes Among Social Security Disability Insurance Program Beneficiaries," Mathematica Policy Research Reports, Mathematica Policy Research 7987, Mathematica Policy Research.

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