Suppose That You Want to Determine the Extent to Which

question 12

Essay

Suppose that you want to determine the extent to which disability insurance (DI)prevents people's working who,in the absence of the program,would have worked.You do this by employing the cross-sectional regression analysis technique described in Chapter 3 and comparing the work histories of those receiving DI with those who are not receiving DI benefits,controlling for observable characteristics.
(a)Is this method likely to be sufficient? Explain.
(b)Bound (1989)studied the moral hazard of disability insurance by examining the employment histories of workers who applied for benefits but were denied them,and then comparing their employment with the employment records of individuals who received disability insurance benefits. (This is a quasi-experimental approach.)How does this approach compare with that described in part a?

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Definitions:

Improving Health

The process of enhancing or restoring physical, mental, or emotional well-being through medical, psychological, or lifestyle interventions.

Government Action

Decisions or measures taken by governing bodies to address public issues, enforce laws, or influence a country's or area's affairs.

Population Health

The study and improvement of the health outcomes of a group of individuals, focusing on the distribution of those outcomes within the population.

Ottawa Charter

A 1986 document that provides a framework for health promotion globally, emphasizing the need for public policy, supportive environments, community action, personal skills, and reorienting health services.