Health Policy

Economic aspects of disability behavior by P. R. de Jong, J. M. Aarts

By P. R. de Jong, J. M. Aarts

One of many extra extraordinary facets of the Dutch Welfare nation is its obvious trouble in controlling the variety of move recipients. a major instance of this administration challenge is the incapacity coverage software. This monograph provides an intensive research of the behavioral responses of staff and companies to this beneficiant incapacity scheme. the guts of the learn is the empirical half in response to a wealthy information set of people who practice for advantages and those that don't. the knowledge derive either from self-reports in addition to scientific and vocational specialist reviews. Combining points of well-being economics, clinical sociology and econometric procedure, the authors may be able to demonstrate the elaborate causalities that underlie the incapacity procedure.

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From these data the 1987 disability amendments aiming at full elimination of labor market considerations from disability assessments appear to have had only a marginal effect. The DI-dependency rate grew from 53 DI-beneficiaries per 1,000 workers insured in 1969 to 131 per 1,000 in 1982. Since then, DI-dependency gradually declined to a level of 122 per 1,000 in 1990. 0 percent in 1989. 4 increase in 1990 is mainly caused by an increase in the number of AAW-beneficiaries. 5). Although both the DI-dependency rate and the GNP-share of Dl-benefit expendi­ tures are valid measures of program growth, a more precise index is the "DIincidence rate", defined as the relative frequency of new DI-awards, and the "termination incidence rate", analogously defined as the annual rate at which DIbeneficiaries leave the Dl-program.

When, in the early 1970s, the purchasing power of minimum wages was raised faster than average wages, real benefits went along. When, in the late 1970s, minimum wages were adjusted yearly to changes in the cost of living, so were benefits. 3 Early Retirement A strict definition of the social security system would not include early retirement programs. However, since its introduction in 1975, early retirement has become an important alternative both to continued labor force participation and to enrolment in unemployment or disability programs for the older members of the labor force.

5 percent wage bill contribution. Less than two thirds of this contribution is employee borne [Bolhuis et al. (1987)]. 4 Unemployment Until 1987, a private sector employee's risk of earnings' loss due to unemploy­ ment was covered by three unemployment programs. The first six months of an unemployment spell were, and still are, covered by Unemployment Insurance (UI, in Dutch WW). Unemployment Insurance benefits replace a fixed percentage (80 percent in 1980, currently 70 percent) of pre-unemployment earnings up to a maximum of Dfl.

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