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Related Experiment Video

Updated: Mar 7, 2026

Measuring the Functional Abilities of Children Aged 3-6 Years Old with Observational Methods and Computer Tools
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Disability Benefit Generosity and Labor Force Withdrawal.

Kathleen J Mullen1, Stefan Staubli2

  • 1RAND and IZA.

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|February 21, 2017
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Summary
This summary is machine-generated.

Higher disability insurance (DI) benefits encourage more people to claim DI. A 1% increase in potential DI benefits led to a 1.2% rise in DI claims, showing benefit generosity significantly impacts program participation.

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Area of Science:

  • Economics
  • Social Policy
  • Labor Economics

Background:

  • Estimating optimal disability insurance (DI) program size and structure requires understanding how benefit generosity influences DI claiming.
  • Identifying this relationship is challenging in systems like the US where benefit schedules are uniform, confounding benefit levels with unobserved work preferences.

Purpose of the Study:

  • To precisely estimate the elasticity of disability insurance claiming with respect to benefit generosity.
  • To overcome the challenge of separating benefit effects from individual work preferences in DI claiming decisions.

Main Methods:

  • Exploited exogenous variation in DI benefits from Austrian reforms (1990s-2000s).
  • Utilized comprehensive administrative social security records for the entire Austrian workforce.
  • Computed benefit levels across six distinct policy regimes to identify the elasticity.

Main Results:

  • A 1% increase in potential DI benefits was associated with a 1.2% increase in DI claiming.
  • Precisely estimated the elasticity of DI claiming concerning benefit generosity.

Conclusions:

  • Benefit generosity is a significant driver of disability insurance claiming behavior.
  • Findings provide crucial data for designing and optimizing disability insurance programs.