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Labour Market Impacts from Disability Onset

Author

Listed:
  • Cain Polidano

    () (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Ha Vu

    (Research School of Economics, College of Business and Economics, The Australian National University)

Abstract

In this paper we estimate the causal labour market impacts of disability onset up to four years after onset using longitudinal data from the Household Income and Labour Dynamics Australia (HILDA) survey and difference-in-difference propensity score matching techniques. We find lasting negative impacts on employment, especially full-time employment, which is linked more to reduced movement into full-time employment than to downshifting from full-time to part-time work. Longer-term, impacts on employment and income support reliance are greater for those without post-school qualifications, which points to differential social costs of onset by education. Therefore, to be cost-effective, prevention and vocational rehabilitation measures should be targeted at low-skilled workers.

Suggested Citation

  • Cain Polidano & Ha Vu, 2012. "Labour Market Impacts from Disability Onset," Melbourne Institute Working Paper Series wp2012n22, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  • Handle: RePEc:iae:iaewps:wp2012n22
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    File URL: http://melbourneinstitute.unimelb.edu.au/downloads/working_paper_series/wp2012n22.pdf
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    References listed on IDEAS

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    7. Michael Lechner & Rosalia Vazquez-Alvarez, 2003. "The Effect of Disability on Labour Market Outcomes in Germany: Evidence from Matching," University of St. Gallen Department of Economics working paper series 2003 2003-20, Department of Economics, University of St. Gallen.
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    Cited by:

    1. Stijn Baert, 2016. "Wage subsidies and hiring chances for the disabled: some causal evidence," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 17(1), pages 71-86, January.

    More about this item

    Keywords

    Disability; employment; propensity score matching;

    JEL classification:

    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • I10 - Health, Education, and Welfare - - Health - - - General

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