Wallace K. C. Mok

A Note on "The Longitudinal Structure of Earnings Losses among Work-Limited Disabled Workers"

Charles (2003) examines the dynamic effects of disability, finding a small decline in earnings and hours following disability onset, even for those who have positive disability reports for each of the next ten years. These outcomes also rebound quickly after the onset of disability. In recent work, Meyer and Mok (2006), find a much larger loss in earnings and a greater decline in hours. Here we find large and persistent declines in earnings and hours, generally several times those reported in Charles (2003). The current findings were arrived at by two research teams working independently without sharing any computer code.

Disability, Taxes, Transfers, and the Economic Well-Being of Women

We study the economic situation of disabled women and the role that taxes and transfers play in improving their economic circumstances, using 1968–2015 data from the Panel Study of Income Dynamics. We begin by documenting the trends in point-in-time disability rates of women as well as estimating the prevalence of disability over a woman’s lifetime. We find that women are more likely than men to have experienced a disability through their midforties, but are less likely to have experienced a serious disability prior to retirement. The onset of disability for women is found to be associated with a fall in labor supply, family income, and consumption. The fall varies with the degree of disability but tends to be smaller than that of disabled men, particularly for family income and consumption. Transfers, particularly disability insurance and Supplemental Security Income, play a large role in cushioning the fall in income for disabled women. However, while the relative decline in income is smaller for women than men, a larger share of disabled women have very low absolute levels of income and consumption. Approximately half of the most disabled women receive food stamp/SNAP benefits, pointing to the greater relative importance of means-tested benefits rather than social insurance for this group.

Disability, earnings, income and consumption

Abstract We study the well-being of disabled men and the economic benefits of disability insurance. Using longitudinal data for 1968–2015 for male household heads, we determine the prevalence of working-age disability, its association with a wide range of economic outcomes including, earnings, income, poverty, consumption, wealth and time-use. We disaggregate disabled men based on the persistence and severity of work-limiting conditions, and find that disability is common and associated with poor economic outcomes. The outcomes differ sharply by disability group. We then provide the range of behavioral elasticities and preference parameters consistent with current disability compensation being optimal in the Baily-Chetty framework.