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Earnings, Disposable Income, and Consumption of Allowed and Rejected Disability Insurance Applicants

Author

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  • Andreas Ravndal Kostøl
  • Magne Mogstad

Abstract

Two key questions in thinking about the size and growth of the disability insurance program are to what extent it discourages work, and how valuable the insurance is to individuals and families. These questions motivate our paper. We begin by describing the earnings, disposable income, and consumption of awarded and rejected DI applicants, before and after the disability onset and the allowance decision. Next, we discuss how these descriptive results can be interpreted through the lens of alternative empirical approaches. Our analysis uses a Norwegian population panel data set with detailed information about every individual and household.

Suggested Citation

  • Andreas Ravndal Kostøl & Magne Mogstad, 2015. "Earnings, Disposable Income, and Consumption of Allowed and Rejected Disability Insurance Applicants," American Economic Review, American Economic Association, vol. 105(5), pages 137-141, May.
    • Handle: RePEc:aea:aecrev:v:105:y:2015:i:5:p:137-41
    Note: DOI: 10.1257/aer.p20151063
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    Citations

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    Cited by:

    1. Landais, Camille & Kolsrud, Jonas & Spinnewijn, Johannes, 2017. "Studying Consumption Patterns using Registry Data: Lessons From Swedish Administrative Data," CEPR Discussion Papers 12402, C.E.P.R. Discussion Papers.
    2. Koning, Pierre & van Lent, Max, 2022. "Workers' Moral Hazard and Insurer Effort in Disability Insurance," IZA Discussion Papers 15164, IZA Network @ LISER.
    3. Jonas Kolsrud & Camille Landais & Peter Nilsson & Johannes Spinnewijn, 2015. "The Optimal Timing of UI Benefits: Theory and Evidence from Sweden," CEP Discussion Papers dp1361, Centre for Economic Performance, LSE.
    4. Sigurd Mølster Galaasen, 2021. "Pension Reform Disabled," Scandinavian Journal of Economics, Wiley Blackwell, vol. 123(4), pages 1227-1260, October.
    5. David Autor & Andreas Kostøl & Magne Mogstad & Bradley Setzler, 2019. "Disability Benefits, Consumption Insurance, and Household Labor Supply," American Economic Review, American Economic Association, vol. 109(7), pages 2613-2654, July.
    6. Jonas Kolsrud & Camille Landais & Peter Nilsson & Johannes Spinnewijn, 2018. "The Optimal Timing of Unemployment Benefits: Theory and Evidence from Sweden," American Economic Review, American Economic Association, vol. 108(4-5), pages 985-1033, April.
    7. Marika Cabral & Mark R. Cullen, 2016. "Estimating the Value of Public Insurance Using Complementary Private Insurance," NBER Working Papers 22583, National Bureau of Economic Research, Inc.
    8. Fadlon, Itzik & Nielsen, Torben Heien, 2019. "Household labor supply and the gains from social insurance," Journal of Public Economics, Elsevier, vol. 171(C), pages 18-28.
    9. Lee, Siha, 2020. "Household responses to disability shocks: Spousal labor supply, caregiving, and disability insurance," CLEF Working Paper Series 21, Canadian Labour Economics Forum (CLEF), University of Waterloo.
    10. Siha Lee, 2024. "Spousal Labor Supply, Caregiving, And The Value Of Disability Insurance," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 65(4), pages 1681-1716, November.

    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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