The Impact of Economic Conditions on Participation in Disability Programs: Evidence from the Coal Boom and Bust
We examine the impact of the coal boom of the 1970's and the coal bust of the 1980's on disability program participation. These shocks provide clear evidence that as the value of labor-market participation increases, disability program participation falls. For the Disability Insurance program, the elasticity of payments with respect to local earnings is between –0.3 and –0.4 and for Supplemental Security Income the elasticity is between –0.4 and –0.7. Consistent with a model where qualifying for disability programs is costly, the relationship between economic conditions and program participation is much stronger for permanent than for transitory economic shocks. (JEL, J0, H0)
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Volume (Year): 92 (2002)
Issue (Month): 1 (March)
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- Angrist, Joshua D, 1990. "Lifetime Earnings and the Vietnam Era Draft Lottery: Evidence from Social Security Administrative Records," American Economic Review, American Economic Association, vol. 80(3), pages 313-36, June.
- McKinley L. Blackburn & David E. Bloom & Richard B. Freeman, 1989. "The Declining Economic Position of Less-Skilled American Males," NBER Working Papers 3186, National Bureau of Economic Research, Inc.
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