Disability Insurance and Male Labor Force Participation: A Response to Haveman and Wolfe

1984 ◽  
Vol 92 (3) ◽  
pp. 542-549 ◽  
Author(s):  
Donald O. Parsons
2018 ◽  
Vol 108 ◽  
pp. 272-276
Author(s):  
Arezou Zaresani

Return-to-work policies in disability insurance (DI) programs allow beneficiaries to collect a portion of their benefits while working. I investigate whether a large increase in incentives to work in a return-to-work policy could induce benefit recipients to increase their labor supply. I quantify the effects on earnings and labor force participation using a sharp discontinuity in the induced incentives to work at the month of the policy change in a DI program in Canada. Using administrative data, I document that large incentives to work could induce beneficiaries to increase their labor supply both in intensive and extensive margins.


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