This paper analyzes the effect of severity of disability on labour force participation by using a self-reported work limitation scale. A dynamic labour force participation model is used to capture the feedback effect of past participation on current participation. The results suggest that net of persistence and unobserved heterogeneity, differences in severity levels explain a significant portion of the variance in the participation rates among disabled individuals. Moreover, the disability is shown to have longer lasting adverse effects on female participation and work limited women will be more likely to benefit from the work requirements imposed on Disability Support Pension recipients.
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number
4328.
Find related papers by JEL classification: J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy I12 - Health, Education, and Welfare - - Health - - - Health Production C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Microeconomic Data
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Nicole Watson & Mark Wooden, 2004.
"The HILDA Survey Four Years On,"
Australian Economic Review,
The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 37(3), pages 343-349, 09.
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