The employment effect of stricter rules for eligibility for DI: Evidence from a natural experiment in Sweden

Karlström, Anders; Palme, Mårten; Svensson, Ingemar

doi:10.1016/j.jpubeco.2008.04.014

“…Kreuger and Meyer 2002). Several studies have shown that persons progress from the unemployment insurance into the sickness insurance when the replacement rate is higher in the latter (Henningsen, 2006;Autor and Duggan, 2006;Karlstrom, Palme andSvensson, 2007 andEuropean Economic Advisory Group, 2007). In Sweden, the sickness insurance is more generous than the unemployment insurance.…”

Section: Sickness and Unemployment Insurancesmentioning

confidence: 99%

Can sickness absence be affected by information meetings? Evidence from a social experiment

Johansson

¹

,

Lindahl

²

2012

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“…Increasing the ERA implies that the choice set of older workers is reduced and that the employment reaction of those who would have chosen to retire depends on the relative attractiveness of the remaining options. There is a large literature that analyzing program substitution e ects in the context of pension reforms (e.g., Duggan et al, 2007;Karlström et al, 2008;Li and Maestas, 2008;Coe and Haverstick, 2010;Staubli, 2011;Staubli and Zweimüller, 2013;Borghans et al, 2014;Atalay and Barrett, 2015;Inderbitzin et al, 2016). However, the existing evidence on the e ectiveness of increasing the ERA and program substitution is mixed.…”

Section: Introductionmentioning

confidence: 99%

Closing Routes to Retirement: How Do People Respond?

Geyer

¹

,

Welteke

²

2017

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. We present quasi-experimental evidence on the employment e ects of an unprecedented large increase in the early retirement age (ERA). Raising the ERA has the potential to extend contribution periods and to reduce the number of pension bene ciaries at the same time, if employment exits are successfully delayed. However, workers may not be able to work longer or may choose other social support programs as exit routes from employment. We study the e ects of the ERA increase on employment and potential program substitution in a regression-discontinuity framework. Germany abolished an important early retirement program for women born after 1951, e ectively raising the ERA for women by three years. We analyze the e ects of this huge increase on employment, unemployment, disability pensions, and inactivity rates. Our results suggest that the reform increased both employment and unemployment rates of women age 60 and over. However, we do not nd evidence for active program substitution from employment into alternative social support programs. Instead employed women remained employed and unemployed women remained unemployed. The results suggest an increase in inequality within the a ected cohorts. Terms of use: Documents in

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“…Unlike other studies that rely on difference-in-differences (DID) across age groups to identify effects of more stringent criteria at application for DI (Karlström et al 2008;Staubli 2011), we adjust for the difference between the age groups in the outcome trend over a period prior to the reform. This trend-adjusted DID (Bell et al 1999) eliminates age-specific trends, as well as period effects.…”

Section: Introductionmentioning

confidence: 99%

Earnings Responses to Disability Benefit Cuts

Mandico

¹

,

García-Gómez

²

,

Gielen

³

et al. 2018

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. average. In response, employment increased by 6.7 points and earnings rose by 18 percent. Recipients were able to increase earnings by e0.64 for each e1 of DI income lost. Female and younger recipients, as well as those with more subjectively defined disabilities, were able to increase earnings most. The earnings response declined as claim duration lengthened, suggesting that earnings capacity deteriorates while on DI. Terms of use: Documents inThe deterioration was steepest for male, younger and fully disabled recipients. Working while claiming partial disability benefits appears to slow the deterioration of earnings capacity.

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The employment effect of stricter rules for eligibility for DI: Evidence from a natural experiment in Sweden

Cited by 95 publications

References 5 publications

Can sickness absence be affected by information meetings? Evidence from a social experiment

Can sickness absence be affected by information meetings? Evidence from a social experiment

Closing Routes to Retirement: How Do People Respond?

Earnings Responses to Disability Benefit Cuts

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