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Great Recession and disability insurance in Spain

Author

Listed:
  • Sergi Jiménez-Martín

    (Universitat Pompeu Fabra)

  • Arnau Juanmarti Mestres

    (Universitat Pompeu Fabra)

  • Judit Vall Castelló

    (Universitat Pompeu Fabra)

Abstract

In this paper, we explore the relationship between economic conditions and disability insurance (DI) participation in Spain during the Great Recession. Using individual-level longitudinal data, we show that DI awards are procyclical, contrary to the countercyclical behavior found in most of the previous literature. We show that DI applications are not responsive to the business cycle and that economic conditions have no effect on the composition of new DI awardees, suggesting that DI participation in Spain is not driven by partially disabled individuals resorting to the DI program as a result of bad labor market conditions. Furthermore, we argue that the procyclical behavior of DI awards may be driven by an informal increase in screening stringency and by an improvement in the health status of the population as a result of worse economic conditions.

Suggested Citation

  • Sergi Jiménez-Martín & Arnau Juanmarti Mestres & Judit Vall Castelló, 2019. "Great Recession and disability insurance in Spain," Empirical Economics, Springer, vol. 56(5), pages 1623-1645, May.
  • Handle: RePEc:spr:empeco:v:56:y:2019:i:5:d:10.1007_s00181-017-1396-1
    DOI: 10.1007/s00181-017-1396-1
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    Cited by:

    1. Sergi Jiménez-Martín & Arnau Juanmarti Mestres & Judit Vall-Castello, 2017. "Hiring subsidies for people with disabilities: Do they work?," Working Papers 967, Barcelona Graduate School of Economics.

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    More about this item

    Keywords

    Disability insurance; Business cycle; Great Recession; Procyclical health;
    All these keywords.

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • I10 - Health, Education, and Welfare - - Health - - - General
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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