Return-to-Work Policies and Labor Supply in Disability Insurance Programs

摘要

Disability Insurance (DI) programs are among the largest social assistance programs in developed countries. These programs provide benefits to individuals with health conditions that limit the amount or type of paid work they can perform. There have been concerns about the high levels of expenditure on DI programs. DI programs also have been criticized for inducing beneficiaries to reduce their labor supply. Most countries therefore have already implemented-or are considering implementing-policies to make their beneficiaries "return to work." These programs allow DI beneficiaries to collect all or a portion of their benefit while working. Although return-to-work policies intend to increase the labor supply in DI programs, the empirical evidence on the effectiveness of such policies is mixed. For example, Hoynes and Moffitt (1999); Benitez-Silva, Buchinsky, and Rust (2011); Weathers and Hemmeter (2011); and Butler et al. (2015) find no effects of financial incentives to work in the United States and Switzerland. However, Campolieti and Riddell (2012); Kostol and Mogstad (2014); and Ruh and Staubli (2016) find positive responses in Canada, Norway, and Austria. Zaresani (2017) suggests that the relative size of the incentives to work induced by a program versus the adjustment costs that individuals face when changingtheir labor supply could possibly explain these disparate findings.