Labor Supply Incentives and Disincentives for the Disabled
The past three decades have witnessed a large and puzzling decline in labor force participation by prime-age males, and a correspondingly large increase in Social Security disability beneficiary roles.This paper reviews the analytical studies that have attempted to determine the causal links between disability, beneficiary status, and labor-force non-participation. Although disability is often thought of as a purely medically determined condition with no labor supply responsiveness to economic factors, models of Social Security disability beneficiary status as an economic decision have had some success in explaining both the growth of the program and the decline in labor force participation. These studies have, however, produced a wide range of estimates of labor supply elasticity, in part because of the difficulty of the underlying econometric problem of estimating the response to two (or more) potential income streams, only one of which is usually observed for any individual.
|Date of creation:||Oct 1985|
|Date of revision:|
|Publication status:||published as Leonard, Jonathan S. "Labor Supply Incentives and Disincentives for the Disabled," Disability and the Labor Market: Economic Problems, Policies, and Programs, eds. M. Berkowitz & M.A. Hill, Ithaca, NY: ILR Press, 1986, pp. 64-94.|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Halpern, Janice & Hausman, Jerry A., 1986.
"Choice under uncertainty: A model of applications for the social security disability insurance program,"
Journal of Public Economics,
Elsevier, vol. 31(2), pages 131-161, November.
- Janice Halpern & Jerry A. Hausman, 1985. "Choice Under Uncertainty: A Model of Applications for the Social Security Disability Insurance Program," NBER Working Papers 1690, National Bureau of Economic Research, Inc.
- Jonathan S. Leonard, 1979. "The Social Security Disability Program and Labor Force Participation," NBER Working Papers 0392, National Bureau of Economic Research, Inc.
- Parsons, Donald O, 1984. "Disability Insurance and Male Labor Force Participation: A Response," Journal of Political Economy, University of Chicago Press, vol. 92(3), pages 542-49, June.
- Saad Z. Nagi & Linda W. Hadley, 1972. "Disability Behavior: Income Change and Motivation to Work," ILR Review, Cornell University, ILR School, vol. 25(2), pages 223-233, January.
- Parsons, Donald O, 1980. "Racial Trends in Male Labor Force Participation," American Economic Review, American Economic Association, vol. 70(5), pages 911-20, December.
- James J. Heckman, 1976. "The Common Structure of Statistical Models of Truncation, Sample Selection and Limited Dependent Variables and a Simple Estimator for Such Models," NBER Chapters, in: Annals of Economic and Social Measurement, Volume 5, number 4, pages 475-492 National Bureau of Economic Research, Inc.
- John D. Worrall, 1978. "A Benefit-Cost Analysis of the Vocational Rehabilitation Program," Journal of Human Resources, University of Wisconsin Press, vol. 13(2), pages 285-298.
- Haveman, Robert H. & Wolfe, Barbara L., 1984. "Disability transfers and early retirement: a casual relationship?," Journal of Public Economics, Elsevier, vol. 24(1), pages 47-66, June.
- Lee, Lung-Fei, 1979. "Identification and Estimation in Binary Choice Models with Limited (Censored) Dependent Variables," Econometrica, Econometric Society, vol. 47(4), pages 977-96, July.
- Danziger, Sheldon & Haveman, Robert & Plotnick, Robert, 1981. "How Income Transfer Programs Affect Work, Savings, and the Income Distribution: A Critical Review," Journal of Economic Literature, American Economic Association, vol. 19(3), pages 975-1028, September.
- Parsons, Donald O, 1980. "The Decline in Male Labor Force Participation," Journal of Political Economy, University of Chicago Press, vol. 88(1), pages 117-34, February.
- Parsons, Donald O, 1982. "The Male Labour Force Participation Decision: Health, Reported Health, and Economic Incentives," Economica, London School of Economics and Political Science, vol. 49(193), pages 81-91, February.
- Haveman, Robert H & Wolfe, Barbara L, 1984. "The Decline in Male Labor Force Participation: Comment," Journal of Political Economy, University of Chicago Press, vol. 92(3), pages 532-41, June.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:1744. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.