Health, disability and work: patterns for the working age population

Abstract

We examine the role of health as a determinant of labour force participation, paying particular attention to the link between the two provided by disability insurance schemes. We first review the evidence on associations between health and labour force participation. Enrolment in disability insurance is not determined by health alone, and we highlight the main other causes that the literature has identified. In an application to The Netherlands, we follow the structure of the literature review and show that the trends in health and disability insurance enrolment look rather positive. In particular, the 1990 reforms of disability insurance might have been more effective than previously realised because part of their success was hidden by demographic change: The large number of baby boomers kept the absolute inflow high as they aged, despite large reductions in relative rates.