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The Dynamic Effect of Disability on Work and Subjective Wellbeing in Australia

Author

Listed:
  • Jones, Melanie K.

    (Cardiff University)

  • Mavromaras, Kostas

    (University of Adelaide)

  • Sloane, Peter J.

    (Swansea University)

  • Wei, Zhang

    (University of Adelaide)

Abstract

Using longitudinal data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey (2001-2013) we examine the relationship between the dynamics of work-limiting disability and employment, hours of work, earnings and life satisfaction. We employ two alternative classifications of the dynamic trajectories of disability and, in doing so, are able to explicitly consider the influence of disability exit in addition to examining onset by chronicity and severity. After controlling for unobserved individual heterogeneity, we find that the positive impact of disability exit is smaller in magnitude and shorter-lived than the negative impact of onset. Further, while individuals are found to recover from a one period disability within three years, there is no sign of adaptation even after ten years for those whose disability is chronic, defined as evident for three or more years post-onset, and severe.

Suggested Citation

  • Jones, Melanie K. & Mavromaras, Kostas & Sloane, Peter J. & Wei, Zhang, 2015. "The Dynamic Effect of Disability on Work and Subjective Wellbeing in Australia," IZA Discussion Papers 9609, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp9609
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    References listed on IDEAS

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    More about this item

    Keywords

    disability; employment; hours of work; earnings; life satisfaction; HILDA;
    All these keywords.

    JEL classification:

    • I10 - Health, Education, and Welfare - - Health - - - General
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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