Seminar: Making Disability Work? The Effects of Financial Incentives on Partially Disabled Workers

Time: 13.00-14.00 hours
Location: CPB-office, Van Stolkweg 14, The Hague

Presentation: Jan-Maarten van Sonsbeek (UWV)

Discussant: Jonneke Bolhaar (CPB)

Language: English

Registration:  Please register here.

Abstract subject:
This study provides insight in the responsiveness of disabled workers to financial incentives, using administrative individual data from the Netherlands from 2006 to 2013. We focus on workers receiving partial DI benefits and with substantial residual work. After the first phase of benefit entitlement, workers that do not use their residual income capacity experience a large drop in benefit income. With entitlement periods in the first phase of DI benefits varying across individuals, we use a difference-in-difference approach to analyze the effects on the incidence of work, the wage earnings and (full) work resumption of disabled workers. Based on the effect estimate on work incidence, we infer a labor elasticity rate of 0.12. Elasticity estimates are highest among younger DI recipients with shorter entitlement periods to the more generous first phase of DI benefits.

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