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Measuring the Effect of Disability on Labor Force Participation


  • Steven Stern


This paper estimates the effect of disability on labor force participation by using symptoms or diseases as instruments in a simultaneous equations model of endogenous reported disability and labor force participation. The results show that each measure of disability explains a significant amount of variation in labor force participation, though the two are not perfect substitutes. There is only weak evidence of endogeneity of the disability variables. For cases where there is evidence of endogeneity, the bias it causes has the opposite effect of that hypothesized in the literatute (i.e., stress causes health to deteriorate with labor force participation). Furthermore, it has only insignificant effects on the coefficients for other variables.

Suggested Citation

  • Steven Stern, 1989. "Measuring the Effect of Disability on Labor Force Participation," Journal of Human Resources, University of Wisconsin Press, vol. 24(3), pages 361-395.
  • Handle: RePEc:uwp:jhriss:v:24:y:1989:i:3:p:361-395

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    References listed on IDEAS

    1. Richard Burkhauser & Karen Holden & Daniel Myers, 1986. "Marital disruption and poverty: The role of survey procedures in artificially creating poverty," Demography, Springer;Population Association of America (PAA), vol. 23(4), pages 621-631, November.
    2. Duncan, Greg J & Gustafsson, Bjorn & Hauser, Richard & Schmauss, Gunther & Messinger, Hans & Muffels, Ruud & Nolan, Brian, 1993. "Poverty Dynamics in Eight Countries," Journal of Population Economics, Springer;European Society for Population Economics, vol. 6(3), pages 215-234.
    3. Stephen P. Jenkins & Christian Schluter & Gert G. Wagner, 2001. "The Dynamics of Child Poverty: Britain and Germany Compared," Discussion Papers of DIW Berlin 233, DIW Berlin, German Institute for Economic Research.
    4. Jenkins, Stephen P. & Schluter, Christian, 2001. "Why are child poverty rates higher in Britain than in Germany? a longitudinal perspective -working paper-," ISER Working Paper Series 2001-16, Institute for Social and Economic Research.
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