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Disability costs and equivalence scales in the older population

  • Morciano, Marcello
  • Hancock, Ruth
  • Pudney, Stephen

We estimate the implicit disability costs faced by older people, using data on over 8,000 individuals from the UK Family Resources Survey. We extend previous research by using a more flexible statistical modelling approach and by allowing for measurement error in observed disability and standard of living indicators. We find that disability costs are strongly related to the severity of disability and to income and – at an average level of almost £100 per week among over-65s with significant disability – they typically far exceed the value of any state disability benefits received.

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File URL: https://www.iser.essex.ac.uk/research/publications/working-papers/iser/2012-09.pdf
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Paper provided by Institute for Social and Economic Research in its series ISER Working Paper Series with number 2012-09.

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Date of creation: 24 Apr 2012
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Publication status: published
Handle: RePEc:ese:iserwp:2012-09
Contact details of provider: Postal: Publications Office, Institute for Social and Economic Research, University of Essex, Wivenhoe Park, Colchester, Essex CO4 3SQ UK
Phone: 44-1206-872957
Fax: 44-1206-873151
Web page: https://www.iser.essex.ac.uk/
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  1. Nelson, Julie A, 1993. "Household Equivalence Scales: Theory versus Policy?," Journal of Labor Economics, University of Chicago Press, vol. 11(3), pages 471-93, July.
  2. Mark B. Stewart, 2009. "The Estimation Of Pensioner Equivalence Scales Using Subjective Data," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 55(4), pages 907-929, December.
  3. Coulter, Fiona A E & Cowell, Frank A & Jenkins, Stephen P, 1992. "Differences in Needs and Assessment of Income Distributions," Bulletin of Economic Research, Wiley Blackwell, vol. 44(2), pages 77-124, April.
  4. J. Cullinan & B. Gannon & S. Lyons, 2011. "Estimating the extra cost of living for people with disabilities," Health Economics, John Wiley & Sons, Ltd., vol. 20(5), pages 582-599, May.
  5. Janet Currie & Brigitte C. Madrian, 1998. "Health, Health Insurance and the Labor Market," JCPR Working Papers 27, Northwestern University/University of Chicago Joint Center for Poverty Research.
  6. Pollak, Robert A & Wales, Terence J, 1979. "Welfare Comparisons and Equivalence Scales," American Economic Review, American Economic Association, vol. 69(2), pages 216-21, May.
  7. repec:ese:iserwp:2010-02 is not listed on IDEAS
  8. Peter Adams & Michael D. Hurd & Daniel L. McFadden & Angela Merrill & Tiago Ribeiro, 2004. "Healthy, Wealthy, and Wise? Tests for Direct Causal Paths between Health and Socioeconomic Status," NBER Chapters, in: Perspectives on the Economics of Aging, pages 415-526 National Bureau of Economic Research, Inc.
  9. Sara Lelli, 2005. "Using Functionings To Estimate Equivalence Scales ," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 51(2), pages 255-284, 06.
  10. repec:ese:iserwp:2010-23 is not listed on IDEAS
  11. James Banks & Richard Blundell & Arthur Lewbel, 1997. "Quadratic Engel Curves And Consumer Demand," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 527-539, November.
  12. repec:ese:iserwp:2010-35 is not listed on IDEAS
  13. Muellbauer, John, 1979. "McClements on equivalence scales for children," Journal of Public Economics, Elsevier, vol. 12(2), pages 221-231, October.
  14. Asghar Zaidi & Tania Burchardt, 2005. "Comparing Incomes When Needs Differ: Equivalization For The Extra Costs Of Disability In The U.K," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 51(1), pages 89-114, 03.
  15. Jones, Andrew & O'Donnell, Owen, 1995. "Equivalence scales and the costs of disability," Journal of Public Economics, Elsevier, vol. 56(2), pages 273-289, February.
  16. Pendakur, Krishna, 1998. "Semiparametric estimates and tests of base-independent equivalence scales," Journal of Econometrics, Elsevier, vol. 88(1), pages 1-40, November.
  17. Gabriella Conti & James Heckman & Sergio Urzua, 2010. "The Education-Health Gradient," American Economic Review, American Economic Association, vol. 100(2), pages 234-38, May.
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