The Decentralization of Social Assistance and the Rise of Disability Insurance Enrolment

Presentation: Gijs Roelofs (CPB)

Discussant: Wolter Hassink (Universiteit Utrecht)

Time and location: Tuesday January 11, from 13.00 - 14.00 hours, CPB office, Van Stolkweg 14, The Hague

Language: English

Registration:  Please register by sending an email to seminar@cpb.nl.

Abstract subject: Expenditure decentralization of Social Assistance improves incentives for municipalities, and enhances productive efficiency of the government. However, it also increases the incentive for local governments to redirect applicants to alternative social arrangements which are administered at a more centralized level. In this paper, we empirically assess the effect of a 2004 reform in the Netherlands giving municipalities full responsibility for their Social Assistance expenditures. Results indicate that the inflow into a centrally administered Disability Insurance scheme for workers with no employment history (‘Wajong’) has doubled as a result of the decentralization of Social Assistance.

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