The Dynamics of Disability, Work and Subjective Well-being ......The Dynamics of Disability, Work...
Transcript of The Dynamics of Disability, Work and Subjective Well-being ......The Dynamics of Disability, Work...
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The Dynamics of Disability, Work
and Subjective Well-being in
Australia
Melanie Jones, Kostas Mavromaras, Peter
Sloane and Zhang Wei
Research Seminar, 20th June 2019, National Institute of
Economic and Social Research, London
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Conservative Party Manifesto 2015
We aim to halve the disability employment gap
by transforming policy, practice and public
attitudes, so that hundreds of thousands more
disabled people who can and want to be in work
find employment.
Conservative Party Manifesto 2017
We will get 1 million more people with disabilities
into employment over the next ten years
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Introduction
• Growing evidence on relationship disability and labour market outcomes – mainly cross sectional data.
• Interest ‘gap’ in outcomes
• Ability adjust for observable characteristics (age; education)
• Attempts identify discrimination. • Problem unobserved influences.
• Policy evaluation
• Disability is dynamic and this can be used to improve our understanding of labour market disadvantage.
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Longitudinal Evidence
• Dynamics of self-reported disability itself (Burchardt, 2000)
• Causal influence of disability (Gannon, 2005; Oguzoglu, 2010)
• Tracing how the disadvantage varies depending on the
dynamic trajectory of disability (Jenkins and Rigg, 2004;
Charles, 2003; Meyer et al., 2008; Jones et al., 2013; Meyer
and Mok, 2019).
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Disadvantage
• Employment and earnings (Charles, 2003; Meyer et al.,
2008; Jones et al., 2013; Meyer and Mok, 2019)
• Annual income, consumption, poverty (Stephens, 2001;
Meyer and Mok, 2019)
• Divorce (Singleton, 2012)
• Life satisfaction
– Adaption to life events (unemployment, marriage/divorce, child
birth) (Clark et al., 2008)
– Disability (Oswald and Powdthavee, 2008; Powdthavee, 2009)
• Adaptation to ‘mild’ disability
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• New evidence on the change in labour market outcomes at
disability onset for Australia (HILDA) • National Disability Insurance Scheme
• Multiple measures of dynamics including explicit consideration
of disability exit and severity.
• Considers broader impact on life satisfaction.
Aims
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• Annual survey of private households (about 8,000 households)
• Longitudinal/panel design – follow individual
• Rich information on variety of life domains
• HILDA waves 1-13 (2001-2013)
• Working age individuals with a minimum of 4 responses
• About 12,600 individuals
• 116,000 person-year observations
Household, Income and Labour Dynamics in
Australia (HILDA)
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• Work-limiting definition of disability: • “Do you have any long-term health condition, impairment or
disability that restricts you in your everyday activities, and has
lasted or is likely to last, for 6 months or more?”
• “Does your condition limit the type of work or the amount of
work you can do?”
• 13.3 per cent of observations
• Indicator of severity • “Could you pick a number between 0 and 10 to indicate how
much your condition limits the amount of work you can do?”
• 6.2 per cent ‘severely’ disabled
• Nature/type
Disability
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• Definition 1: Consistent onset or exit (Jones et al., 2013) • Always with a disability in the sampling frame
• Never with a disability in the sampling frame
• Consistent onset: experienced onset without exit
• Consistent exit: experienced exit without a further onset
• All other patterns of disability within the sampling frame.
• Definition 2: Chronicity and severity of onset (Meyer and Mok,
2019) • One-time: once in the sampling frame
• Temporary: two or three instances in the sampling frame
• Chronically disabled: four or more instances in the sampling
frame
• Further distinguish between chronic not severe and chronic
severe
Disability Dynamics
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Total
Cases %
Continuously disabled 506 4.0
Continuously non-disabled 8,823 70.6
Consistent onset 228 1.8
Consistent exit 268 2.1
Irregular 2,679 21.4
Total 12,504 100.0
Total
Cases %
One-time disabled 661 30.2
Temporarily disabled 620 28.3
Chronically disabled (not severe) 403 18.4
Chronically disabled (severe) 507 23.1
All onset 2,191 100.0
Definition 1:
Definition 2:
Disability Dynamics
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ILO employment (activity last week)
• Gap is pronounced at 36.6 percentage points (82.0% for
non-disabled compared to 45.4% for disabled)
Usual weekly hours
Subjective well-being
“All things considered, how satisfied are you with your life?”
Responses 11 point scale: 0 (least satisfied) and 10 (most
satisfied)
• Gap 0.8 index points (10%)
Facets
Disadvantage
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Event Study Methodology: Charles (2003) and
Meyer and Mok (2008)
𝑌𝑖𝑡 = 𝛼𝑖 + 𝛾𝑡 + 𝑋𝑖𝑡𝛽 + 𝛿𝑘𝑔𝐴𝑘𝑖𝑡𝑔
𝑘𝑔 + 𝜀𝑖𝑡
𝑌𝑖𝑡 = measure of employment or life satisfaction 𝛼𝑖 = individual fixed effects
𝛾𝑡 = time period fixed effects (year of interview)
𝑋𝑖𝑡= controls for observable time varying personal characteristics (age, age squared, education level, marital status, children, urban/rural)
𝐴𝑘𝑖𝑡𝑔
is a dummy variable which equals 1 if in year t individual i belongs
to onset group g and he/she is k years from onset (a minus indicates prior to onset).
𝛿𝑘𝑔 measures the influence of group g disability k years away from onset,
relative to that more than 3 years pre-onset.
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Year from onset/exit Definition 1
Consistent onset Consistent exit
Coef. S.E. Coef. S.E.
-3 -0.068* (0.04) 0.159** (0.08)
-2 -0.060 (0.05) 0.100 (0.08)
-1 -0.114** (0.05) 0.166** (0.07)
0 -0.344*** (0.05) 0.251*** (0.08)
1 -0.359*** (0.06) 0.251*** (0.08)
2 -0.399*** (0.05) 0.284*** (0.08)
3 -0.411*** (0.05) 0.274*** (0.08)
4 -0.400*** (0.05) 0.275*** (0.08)
5 -0.444*** (0.06) 0.296*** (0.09)
6 -0.465*** (0.06) 0.282*** (0.09)
7 -0.440*** (0.06) 0.261*** (0.09)
8 -0.460*** (0.06) 0.269*** (0.09)
9 -0.412*** (0.06) 0.252*** (0.10)
10+ -0.406*** (0.07) 0.292*** (0.10)
No. of observations 102,382 12,073
The Dynamic Effect on Employment
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Year from onset/exit Definition 2
One-time Temporary Chronic non-severe Chronic severe
Coef. S.E. Coef. S.E. Coef. S.E. Coef. S.E.
-3 -0.039** (0.02) -0.015 (0.02) -0.021 (0.03) -0.056* (0.03)
-2 -0.045** (0.02) -0.020 (0.02) -0.024 (0.03) -0.042 (0.03)
-1 -0.045** (0.02) -0.017 (0.02) -0.020 (0.04) -0.076** (0.03)
0 -0.067*** (0.02) -0.063*** (0.02) -0.072** (0.04) -0.270*** (0.04)
1 -0.020 (0.02) -0.053** (0.02) -0.086** (0.04) -0.266*** (0.04)
2 -0.036* (0.02) -0.030 (0.02) -0.077** (0.04) -0.297*** (0.04)
3 -0.023 (0.02) -0.012 (0.02) -0.059 (0.04) -0.310*** (0.04)
4 -0.021 (0.02) -0.036 (0.03) -0.065* (0.04) -0.273*** (0.04)
5 -0.003 (0.02) -0.009 (0.03) -0.056 (0.04) -0.325*** (0.04)
6 -0.011 (0.02) -0.009 (0.03) -0.070* (0.04) -0.343*** (0.04)
7 -0.011 (0.02) 0.006 (0.03) -0.081** (0.04) -0.318*** (0.04)
8 -0.035 (0.03) 0.014 (0.03) -0.080* (0.04) -0.339*** (0.04)
9 -0.017 (0.03) 0.038 (0.04) -0.098** (0.05) -0.344*** (0.05)
10+ 0.048 (0.03) -0.027 (0.04) -0.105** (0.05) -0.360*** (0.05)
No. of observations 102,382
The Dynamic Effect on Employment
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The Dynamic Effect on Employment
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Year from onset/exit Definition 1
Consistent onset Consistent exit
Coef. S.E. Coef. S.E.
-3 -0.163 (0.16) -0.050 (0.31)
-2 -0.213 (0.15) 0.145 (0.26)
-1 -0.197 (0.16) 0.068 (0.25)
0 -0.858*** (0.20) 0.153 (0.24)
1 -0.679*** (0.19) 0.084 (0.26)
2 -0.798*** (0.18) 0.229 (0.25)
3 -0.899*** (0.19) -0.055 (0.27)
4 -0.857*** (0.20) 0.177 (0.27)
5 -0.824*** (0.23) -0.073 (0.28)
6 -0.864*** (0.21) -0.055 (0.29)
7 -0.936*** (0.24) -0.165 (0.30)
8 -1.418*** (0.28) -0.032 (0.31)
9 -1.028*** (0.26) -0.068 (0.32)
10+ -0.691** (0.31) -0.144 (0.32)
No. of observations 102,400 12,072
The Dynamic Effect on Life Satisfaction
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Year from onset/exit Definition 2
One-time Temporary Chronic non-severe Chronic severe
Coef. S.E. Coef. S.E. Coef. S.E. Coef. S.E.
-3 0.007 (0.06) -0.082 (0.07) 0.004 (0.12) -0.071 (0.12)
-2 -0.079 (0.06) -0.158** (0.07) 0.016 (0.11) -0.108 (0.12)
-1 -0.074 (0.06) -0.198*** (0.07) -0.040 (0.11) -0.136 (0.12)
0 -0.292*** (0.07) -0.379*** (0.08) -0.241** (0.12) -0.635*** (0.14)
1 -0.091 (0.07) -0.320*** (0.07) -0.039 (0.12) -0.618*** (0.13)
2 -0.023 (0.06) -0.253*** (0.08) -0.019 (0.11) -0.586*** (0.13)
3 -0.035 (0.06) -0.214*** (0.08) -0.172 (0.12) -0.677*** (0.14)
4 0.008 (0.06) -0.241*** (0.08) -0.102 (0.12) -0.612*** (0.14)
5 0.100 (0.07) -0.192** (0.08) -0.057 (0.13) -0.673*** (0.15)
6 -0.015 (0.08) -0.258*** (0.10) -0.168 (0.13) -0.689*** (0.15)
7 0.045 (0.08) -0.276*** (0.10) -0.226* (0.14) -0.705*** (0.17)
8 -0.029 (0.09) -0.187* (0.11) -0.194 (0.13) -0.891*** (0.16)
9 0.092 (0.10) -0.299** (0.12) -0.253* (0.15) -0.715*** (0.19)
10+ -0.060 (0.13) 0.041 (0.11) -0.188 (0.14) -0.650*** (0.16) No. of observations 102,400
The Dynamic Effect on Life Satisfaction
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• The home in which you live
• Your employment opportunities
• Your financial situation
• How safe you feel
• Feeling part of the community
• Your health
• The neighbourhood in which you live
• The amount of free time you have
Facets of Life Satisfaction
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Facets of Life Satisfaction – consistent onset
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Facets of Life Satisfaction – consistent exit
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Conclusions
Employment • Effects of consistent onset and exit – considerable magnitude
(and persistent)
• Chronicity matters
• One time and temporary disability have no long-lasting
employment effects
• No improvement for chronic severe disability
Life Satisfaction • Negative consistent onset effects – no adaptation/no exit effects
• One time disability has no long-lasting effects
• No adaption to chronic severe disability
• Facets provide insights into the channels through which disability
influences life satisfaction
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Conclusions
Policy Implications • Heterogeneity in disadvantage – importance of chronicity and
severity – tailored support?
• Asymmetry life satisfaction – policy support post disability exit?
Extensions • Other outcomes (income; disability benefits)
• Impact on the household (labour supply spouse; divorce)
• Age of onset
• Limitations arising from mental versus physical health problems
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The Dynamics of Disability, Work
and Subjective Well-being in
Australia
Melanie Jones, Kostas Mavromaras, Peter
Sloane and Zhang Wei
Research Seminar, 20th June 2019, National Institute of
Economic and Social Research, London