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The Dynamics of Disability and Benefit Receipt in Britain

Author

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  • Jones, Melanie K.

    () (Cardiff University)

  • McVicar, Duncan

    () (Queen's University Belfast)

Abstract

This paper exploits rarely-used longitudinal data to examine the impacts of disability onset on benefit receipt in Britain over the period 2004–2012. Differences in the timing of onset are exploited for identification in a framework that combines propensity score matching with difference-in-differences estimation. Disability onset increases receipt of disability insurance, a wider measure of sickness and disability benefits, and receipt of non-sickness benefits by six, eight and six percentage points respectively in the first year. These effects do not vary significantly by individual characteristics, but are larger for more severe disability onset, for those who did not previously report a long-term health condition, and for those who experienced disability onset under the less restrictive pre-2009 disability benefit regime. Contrary to the perception of disability benefits being an absorbing state, disability exit has an almost symmetrical impact on receipt of disability insurance and on wider sickness benefits in the first year.

Suggested Citation

  • Jones, Melanie K. & McVicar, Duncan, 2017. "The Dynamics of Disability and Benefit Receipt in Britain," IZA Discussion Papers 11186, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp11186
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    References listed on IDEAS

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    More about this item

    Keywords

    disability; disability onset; disability exit; welfare benefits; disability insurance; propensity score matching;

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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