Discussion Papers no. 496
Evidence from plant downsizing
Social interaction effects in disability pension participation
We estimate the magnitude of social interaction effects in disability pension participation among older workers in Norway. Specifically, we investigate how a worker's propensity to draw disability benefits is affected by a plausibly exogenous shock to the disability entry rate of similarly-aged workers in his or her neighborhood. The problem of omitted variable bias is addressed by employing a novel instrumental variable (IV) strategy, using plant downsizing at neighbors' plants of employment as an instrument for the disability entry rate among one's previously employed neighbors. Our IV estimates suggest that a one percentage point increase in the participation rate of previously employed neighbors increased the subsequent 4-year entry rate of workers by about one-half a percentage point. Numerous robustness and specification tests appear to support the validity of the identifying assumption in our IV strategy.
Om publikasjonen
- Tittel
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Social interaction effects in disability pension participation. Evidence from plant downsizing
- Ansvarlige
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Mari Rege, Mark Votruba, Kjetil Telle
- Serie og -nummer
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Discussion Papers no. 496
- Utgiver
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Statistics Norway
- Emne
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Discussion Papers
- Antall sider
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45
- Målform
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Engelsk
- Om Discussion Papers
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Discussion papers comprise research papers intended for international journals and books. A preprint of a Discussion Paper may be longer and more elaborate than a standard journal article as it may include intermediate calculations, background material etc.
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