Abstract
We evaluate the impact of vocational rehabilitation (VR) services on employment outcomes of adults with physical disabilities. Using detailed panel data from the Virginia Department of Aging and Rehabilitation Services in state fiscal year 2000, we estimate a structural model of participation that accounts for the potentially sudden onset of physical impairments and the endogenous selection of VR services. The results imply that VR services have large, positive long-run labor market effects that substantially exceed the cost of providing services.
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