NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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Bradley J. Setzler

Department of Economics
University of Chicago
1126 East 59th Street
Chicago, IL 60637

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NBER Working Papers and Publications

June 2017Disability Benefits, Consumption Insurance, and Household Labor Supply
with David Autor, Andreas Ravndal Kostol, Magne Mogstad: w23466
There is no evaluation of the consequences of Disability Insurance (DI) receipt that captures the effects on households' net income and consumption expenditure, family labor supply, or benefits from other programs. Combining detailed register data from Norway with an instrumental variables approach based on random assignment to appellant judges, we comprehensively assess how DI receipt affects these understudied outcomes. To consider the welfare implications of the findings from this instrumental variables approach, we estimate a dynamic model of household behavior that translates employment, reapplication and savings decisions into revealed preferences for leisure and consumption. The model-based results suggest that on average, the willingness to pay for DI receipt is positive and sizabl...
 
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