The effects of firm incentives in Disability Insurance on firms' hiring decisions

Small Fund Research Project
Amelia Hawkins

Modernization of the US Social Security Disability Insurance (SSDI) program has long been discussed. The rising fraction of working-aged adults claiming SSDI, the solvency of the SSDI Trust Fund and the decline in the fraction of employment among adults with disabilities have all contributed to the call for changes. Over the years the Social Security Administration has implemented or piloted a variety of reforms aimed at reducing the SSDI rolls, including stricter screening of applicants, removal of beneficiaries, and work incentives for beneficiaries. However, these approaches have all had very limited success in stemming the growth of the SSDI rolls and none has significantly helped the employment outcomes of people with disabilities. The aim of this project will be to empirically answer the following research question: To what extent and how does firm liability for DI benefits affect the decision of firms to hire workers, especially workers most likely to enter DI?

Eva L. Mueller New Directions in Economics and Demography Fund

Funding Period: 5/15/2017 to 5/31/2018

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