This paper exploits the effectively random assignment of judges to
Disability Insurance cases to estimate the causal impact of Disability
Insurance receipt on labor supply. We find that benefit receipt reduces
labor force participation by 26 percentage points three years after a
disability determination decision, although the reduction is smaller
for older people, college graduates, and those with mental illness.
OLS and instrumental variables estimates are similar. Furthermore,
over 60 percent of those denied benefits by an administrative law
judge are subsequently allowed benefits within ten years, showing
that most applicants apply, reapply, and appeal until they get benefits.
French, Eric, and Jae Song.
"The Effect of Disability Insurance Receipt on Labor Supply."
American Economic Journal: Economic Policy,
Social Security and Public Pensions
Economics of the Elderly; Economics of the Handicapped; Non-labor Market Discrimination
Time Allocation and Labor Supply
Regulated Industries and Administrative Law