Decomposing Employment Trends of Disabled Workers

Pierre Koning*, Heike Vethaak

*Corresponding author for this work

Research output: Contribution to JournalArticleAcademicpeer-review

Abstract

This paper estimates Age-Period-Cohort models on employment rates of Dutch Disability Insurance (DI) applicants. We find that the substantial decrease in employment between 1999 and 2013 is explained by year-of-Application cohort effects and that period effects are negligible. In turn, application cohort effects partly stem from increasing shares of applicants without permanent contracts. Changes in application cohort effects are largely confined to the years following two DI reforms that increased self-screening among workers. We next analyze changes in employment rates of awarded and rejected applicants and follow a Difference-in-Differences approach. Assuming common compositional cohort effects, we infer negligible effects of changes in benefit conditions.

Original languageEnglish
Pages (from-to)1217-1255
JournalB.E. Journal of Economic Analysis and Policy
Volume21
Issue number4
DOIs
Publication statusAccepted/In press - 2021

Bibliographical note

Funding Information:
This research is sponsored by Instituut Gak. The authors are grateful to Patrick Hullegie for his indispensable work on the data. They also thank Nicole Maestas, Jan-Maarten van Sonsbeek, Eric French, Astrid Grasdal, Lawrence Katz, Marike Knoef, Carla van Deursen, Barend Barentsen and seminar participants at the Dutch Economists Day of 2019, the University of Bergen, the University of Nantes, the KVS New Paper Sessions of 2019 and the EALE/SOLE/AASLE World Meeting of 2020 for useful comments to presentations and earlier drafts of the paper.

Publisher Copyright:
© 2021 Pierre Koning et al., published by De Gruyter, Berlin/Boston 2021.

Copyright:
Copyright 2021 Elsevier B.V., All rights reserved.

Keywords

  • APC models
  • disability insurance
  • employment
  • self-screening

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