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Financial incentives in disability insurance in the Netherlands

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  • Annemiek van Vuren
  • Daniel van Vuuren

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Abstract

In this paper, we assess the impact of financial incentives on the inflow in the public Disability Insurance (DI) scheme in the Netherlands. For this matter, the variation in replacement rates over different sectors is exploited to estimate the probability of DI enrolment over a sample of employees from the Dutch Income Panel (1996-2000). On the basis of these administrative data, we find a point estimate of the elasticity of DI enrolment with respect to the DI wealth rate of 2.5.

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Bibliographic Info

Paper provided by CPB Netherlands Bureau for Economic Policy Analysis in its series CPB Discussion Paper with number 45.

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Date of creation: Apr 2005
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Handle: RePEc:cpb:discus:45

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References

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  1. Maarten Lindeboom, 1998. "Microeconometric Analysis of the Retirement Decision: The Netherlands," OECD Economics Department Working Papers 207, OECD Publishing.
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  3. Hassink, R. & Ours, J.C. van & Ridder, G., 1997. "Dismissal through disability," Open Access publications from Tilburg University urn:nbn:nl:ui:12-86871, Tilburg University.
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  5. Kreider, Brent & Riphahn, Regina T., 1998. "Applications to the U.S. Disability System: A Semiparametric Approach for Men and Women," IZA Discussion Papers 17, Institute for the Study of Labor (IZA).
  6. Jonathan Gruber, 1996. "Disability Insurance Benefits and Labor Supply," NBER Working Papers 5866, National Bureau of Economic Research, Inc.
  7. Dan Black & Kermit Daniel & Seth Sanders, 2002. "The Impact of Economic Conditions on Participation in Disability Programs: Evidence from the Coal Boom and Bust," American Economic Review, American Economic Association, vol. 92(1), pages 27-50, March.
  8. J.S. Cramer, 2000. "Scoring Bank Loans that may go wrong: A Case Study," Tinbergen Institute Discussion Papers 00-090/4, Tinbergen Institute.
  9. Arie Kapteyn & Klaas de Vos, 1997. "Social Security and Retirement in The Netherlands," NBER Working Papers 6135, National Bureau of Economic Research, Inc.
  10. Jonathan Gruber & David A. Wise, 1999. "Social Security and Retirement around the World," NBER Books, National Bureau of Economic Research, Inc, number grub99-1, May.
  11. Benitez-Silva, Hugo & Buchinsky, Moshe & Chan, Hiu Man & Rust, John & Sheidvasser, Sofia, 1999. "An empirical analysis of the social security disability application, appeal, and award process," Labour Economics, Elsevier, vol. 6(2), pages 147-178, June.
  12. Pierre Koning, 2004. "Estimating the impact of experience rating on the inflow into disability insurance in the Netherlands," CPB Discussion Paper 37, CPB Netherlands Bureau for Economic Policy Analysis.
  13. William Greene, 2004. "The behaviour of the maximum likelihood estimator of limited dependent variable models in the presence of fixed effects," Econometrics Journal, Royal Economic Society, vol. 7(1), pages 98-119, 06.
  14. Hausman, J. A. & Abrevaya, Jason & Scott-Morton, F. M., 1998. "Misclassification of the dependent variable in a discrete-response setting," Journal of Econometrics, Elsevier, vol. 87(2), pages 239-269, September.
  15. Bound, John & Burkhauser, Richard V., 1999. "Economic analysis of transfer programs targeted on people with disabilities," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 51, pages 3417-3528 Elsevier.
  16. Wolter Hassink, 2000. "Job destruction through quits or layoffs?," Applied Economics Letters, Taylor & Francis Journals, vol. 7(1), pages 45-47.
  17. J.S. Cramer, 2005. "Omitted Variables and Misspecified Disturbances in the Logit Model," Tinbergen Institute Discussion Papers 05-084/4, Tinbergen Institute.
  18. Courtney Coile & Jonathan Gruber, 2000. "Social Security and Retirement," NBER Working Papers 7830, National Bureau of Economic Research, Inc.
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Citations

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Cited by:
  1. Rob Euwals & Daniel J. van Vuuren & Ronald P. Wolthoff, 2006. "Early Retirement Behaviour in the Netherlands: Evidence from a Policy Reform," Tinbergen Institute Discussion Papers 06-021/3, Tinbergen Institute.
  2. Sonsbeek, J.M. van & Gradus, R.H.J.M., 2005. "A microsimulation analysis of the 2006 regime change in the Dutch disability scheme," Serie Research Memoranda 0012, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
  3. Tunga Kantarci & Arthur Soest, 2008. "Gradual Retirement: Preferences and Limitations," De Economist, Springer, vol. 156(2), pages 113-144, June.
  4. Ruud de Mooij, 2006. "Reinventing the welfare state," CPB Special Publication 60, CPB Netherlands Bureau for Economic Policy Analysis.
  5. Pierre Koning & Daniel van Vuuren, 2006. "Hidden unemployment in disability insurance in the Netherlands; an empirical analysis based on employer data," CPB Discussion Paper 69, CPB Netherlands Bureau for Economic Policy Analysis.
  6. Rob Euwals & Daniel van Vuuren & Annemiek van Vuren, 2011. "The impact of reforms on labour market exit probabilities," CPB Discussion Paper 179, CPB Netherlands Bureau for Economic Policy Analysis.
  7. Barbara Hanel, 2011. "The Effect of Disability Pension Incentives on Early Retirement Decisions," Melbourne Institute Working Paper Series wp2011n05, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  8. Cremer, Helmuth & Lozachmeur, Jean-Marie & Pestieau, Pierre, 2009. "Use and misuse of unemployment benefits for early retirement," European Journal of Political Economy, Elsevier, vol. 25(2), pages 174-185, June.
  9. Euwals, Rob & van Vuren, Annemiek & van Vuuren, Daniel, 2011. "The Decline of Early Retirement Pathways in the Netherlands: An Empirical Analysis for the Health Care Sector," IZA Discussion Papers 5810, Institute for the Study of Labor (IZA).

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