Disability Benefits, Consumption Insurance, and Household Labor Supply
There is no evaluation of the consequences of Disability Insurance (DI) receipt that captures the effects on households' net income and consumption expenditure, family labor supply, or benefits from other programs. Combining detailed register data from Norway with an instrumental variables appr...
| Main Authors: | , , , |
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| Other Authors: | |
| Format: | Article |
| Language: | English |
| Published: |
American Economic Association
2020
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| Online Access: | https://hdl.handle.net/1721.1/128851 |
| _version_ | 1811081517813727232 |
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| author | Autor, David H Kostøl, Andreas Mogstad, Magne Setzler, Bradley |
| author2 | Massachusetts Institute of Technology. Department of Economics |
| author_facet | Massachusetts Institute of Technology. Department of Economics Autor, David H Kostøl, Andreas Mogstad, Magne Setzler, Bradley |
| author_sort | Autor, David H |
| collection | MIT |
| description | There is no evaluation of the consequences of Disability Insurance (DI) receipt that captures the effects on households' net income and consumption expenditure, family labor supply, or benefits from other programs. Combining detailed register data from Norway with an instrumental variables approach based on random assignment to appellant judges, we comprehensively assess how DI receipt affects these understudied outcomes. To consider the welfare implications of the findings from this instrumental variables approach, we estimate a dynamic model of household behavior that translates employment, reapplication, and savings decisions into revealed preferences for leisure and consumption. The model-based results suggest that on average, the willingness to pay for DI receipt is positive and sizable. Because spousal labor supply strongly buffers the household income and consumption effects of DI allowances, the estimated willingness to pay for DI receipt is smaller for married than single applicants. |
| first_indexed | 2024-09-23T11:47:48Z |
| format | Article |
| id | mit-1721.1/128851 |
| institution | Massachusetts Institute of Technology |
| language | English |
| last_indexed | 2024-09-23T11:47:48Z |
| publishDate | 2020 |
| publisher | American Economic Association |
| record_format | dspace |
| spelling | mit-1721.1/1288512022-09-27T21:59:57Z Disability Benefits, Consumption Insurance, and Household Labor Supply Autor, David H Kostøl, Andreas Mogstad, Magne Setzler, Bradley Massachusetts Institute of Technology. Department of Economics There is no evaluation of the consequences of Disability Insurance (DI) receipt that captures the effects on households' net income and consumption expenditure, family labor supply, or benefits from other programs. Combining detailed register data from Norway with an instrumental variables approach based on random assignment to appellant judges, we comprehensively assess how DI receipt affects these understudied outcomes. To consider the welfare implications of the findings from this instrumental variables approach, we estimate a dynamic model of household behavior that translates employment, reapplication, and savings decisions into revealed preferences for leisure and consumption. The model-based results suggest that on average, the willingness to pay for DI receipt is positive and sizable. Because spousal labor supply strongly buffers the household income and consumption effects of DI allowances, the estimated willingness to pay for DI receipt is smaller for married than single applicants. US Social Security Administration (Grant 1-DRC12000002-03) 2020-12-17T16:55:21Z 2020-12-17T16:55:21Z 2019-07 2019-10-18T18:46:36Z Article http://purl.org/eprint/type/JournalArticle 0002-8282 1944-7981 https://hdl.handle.net/1721.1/128851 Autor, David et al. "Disability Benefits, Consumption Insurance, and Household Labor Supply." American Economic Review 109, 7 (July 2019): 2613-54 © 2019 American Economic Association en http://dx.doi.org/10.1257/AER.20151231 American Economic Review Article is made available in accordance with the publisher's policy and may be subject to US copyright law. Please refer to the publisher's site for terms of use. application/pdf American Economic Association American Economic Association |
| spellingShingle | Autor, David H Kostøl, Andreas Mogstad, Magne Setzler, Bradley Disability Benefits, Consumption Insurance, and Household Labor Supply |
| title | Disability Benefits, Consumption Insurance, and Household Labor Supply |
| title_full | Disability Benefits, Consumption Insurance, and Household Labor Supply |
| title_fullStr | Disability Benefits, Consumption Insurance, and Household Labor Supply |
| title_full_unstemmed | Disability Benefits, Consumption Insurance, and Household Labor Supply |
| title_short | Disability Benefits, Consumption Insurance, and Household Labor Supply |
| title_sort | disability benefits consumption insurance and household labor supply |
| url | https://hdl.handle.net/1721.1/128851 |
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