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Severity of Work Disability and Work


  • Oguzoglu, Umut

    () (University of Manitoba)


This paper analyzes the effect of severity of disability on labour force participation by using a self-reported work limitation scale. A dynamic labour force participation model is used to capture the feedback effect of past participation on current participation. The results suggest that net of persistence and unobserved heterogeneity, differences in severity levels explain a significant portion of the variance in the participation rates among disabled individuals. Moreover, the disability is shown to have longer lasting adverse effects on female participation and work limited women will be more likely to benefit from the work requirements imposed on Disability Support Pension recipients.

Suggested Citation

  • Oguzoglu, Umut, 2009. "Severity of Work Disability and Work," IZA Discussion Papers 4328, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp4328

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    References listed on IDEAS

    1. Bound, John & Burkhauser, Richard V., 1999. "Economic analysis of transfer programs targeted on people with disabilities," Handbook of Labor Economics,in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 51, pages 3417-3528 Elsevier.
    2. Jeffrey M. Wooldridge, 2005. "Simple solutions to the initial conditions problem in dynamic, nonlinear panel data models with unobserved heterogeneity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(1), pages 39-54.
    3. John Bound & Michael Schoenbaum & Timothy Waidmann, 1995. "Race and Education Differences in Disability Status and Labor Force Attachment," NBER Working Papers 5159, National Bureau of Economic Research, Inc.
    4. Nicole Watson & Mark Wooden, 2004. "The HILDA Survey Four Years On," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 37(3), pages 343-349, September.
    5. Owen O'Donnell, 1998. "The Effect of Disability on Employment Allowing for Work Incapacity," Studies in Economics 9813, School of Economics, University of Kent.
    6. John Bound, 1991. "Self-Reported Versus Objective Measures of Health in Retirement Models," Journal of Human Resources, University of Wisconsin Press, vol. 26(1), pages 106-138.
    7. Mundlak, Yair, 1978. "On the Pooling of Time Series and Cross Section Data," Econometrica, Econometric Society, vol. 46(1), pages 69-85, January.
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    Cited by:

    1. Jones, Melanie K & Mavromaras, Kostas & Sloane, Peter J & Wei, Zhang (NILS), 2011. "NILS Working paper no 176. Disability and job mismatches in the Australian labour market," NILS Working Papers 26074, National Institute of Labour Studies.
    2. Jones, Melanie K. & Mavromaras, Kostas G. & Sloane, Peter J. & Wei, Zhang, 2015. "The Dynamic Effect of Disability on Work and Subjective Wellbeing in Australia," IZA Discussion Papers 9609, Institute for the Study of Labor (IZA).
    3. Zucchelli, E. & Harris, M. & Zhao, X., 2012. "Ill-health and transitions to part-time work and self-employment among older workers," Health, Econometrics and Data Group (HEDG) Working Papers 12/04, HEDG, c/o Department of Economics, University of York.
    4. Mavromaras, Kostas G. & Sloane, Peter J. & Wei, Zhang, 2011. "Disability and Job Mismatches in the Australian Labour Market," IZA Discussion Papers 6152, Institute for the Study of Labor (IZA).
    5. Umut Oguzoglu, 2016. "Disability and Multi-State Labour Force Choices with State Dependence," The Economic Record, The Economic Society of Australia, vol. 92(296), pages 28-46, March.
    6. Harris, M.N. & Zhao, X. & Zucchelli, E., 2016. "The dynamics of health and labour market transitions at older ages: evidence from a multi-state model," Health, Econometrics and Data Group (HEDG) Working Papers 16/30, HEDG, c/o Department of Economics, University of York.

    More about this item


    labour force participation; work disability; severity;

    JEL classification:

    • J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access

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