Effects of Disability Insurance Generosity of Labor Market Outcomes and Worker Health
Early Career Research Award
The goal of this project is to identify how disability insurance (DI) generosity affects labor force participation and worker health and well-being. We will study a 2003 DI reform in Austria that substantially lowered the level of cash transfers for some individuals. Using linked data on Upper Austrian workers from 1996-2018 we will estimate how this change in DI generosity affected labor market outcomes, including unemployment claims, occupation, and wages, as well as health outcomes, including dependence on opioids and antidepressants, hospitalizations, cardiac events, and injuries. We will then link worker data to their children’s health records in an attempt to measure how much DI payments can affect health within households. In doing so, these estimates will speak to the welfare costs of tightening DI parameters and the spillover effects of health-related conditional cash transfers.