NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Choice Under Uncertainty: A Model of Applications for the Social Security Disability Insurance Program

Janice Halpern, Jerry A. Hausman

NBER Working Paper No. 1690
Issued in August 1985
NBER Program(s):   LS

Not all people with health problems are disabled. Some individuals with severe physical or mental impairments, such as blindness or limb amputation, continue to hold jobs and generally function satisfactorily.They constitute, however, a group of potentially disabled individuals who might apply and qualify for Disability Insurance or other disability-related benefits if they were to lose their jobs or to decide that employment offered an inadequate financial or non-pecuniary reward. Thus, disability, or a health-related inability to work, is more than a medical problem but involves motivational and attitudinal factors. We specify a model of the application process, which we model as choice under uncertainty about approval of an application for Disability Insurance. We specify the possible outcomes to the choice process of an individual in which the probability of acceptance for Disability Insurance is a key consideration. We then estimate a joint model of labor supply and application to the Disability Insurance program based on the 1972 survey. We then compare our results to the observed time series applications process since 1976. Lastly, we estimate the sensitivity of the application process to the probability of acceptance and the level of benefits.

download in pdf format
   (536 K)

download in djvu format
   (381 K)

email paper

This paper is available as PDF (536 K) or DjVu (381 K) (Download viewer) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w1690

Published: Halpern, Janice and Jerry Hausman. "Choice Under Uncertainty: A Model of Applications for the Social Security Disability Insurance Program," Journal of Public Economics, Vol. 31, 1986, pp. 131-162. citation courtesy of

Users who downloaded this paper also downloaded these:
Leonard w0392 The Social Security Disability Program and Labor Force Participation
Bound w2816 The Health and Earnings of Rejected Disability Insurance Applicants
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us