Carel Petersen

An explanation of the growth of social security disability transfers

SummaryThe purpose of this paper is to provide an explanation for the growth of one of the most important components of social security income transfers: disability benefits to people who withdraw from the labour market as a consequence of becoming disabled. We use a disability model and apply this to branches of industry for the Netherlands (1968-1979). The main conclusion is that the growth of disability incidence rates can to a large degree be explained by worsening of the economic situation. In addition to this a change in another variable, namely perception of health, plays a role in the explanation of the growth fo disability transfers.