Severity of Work Disability and Work

This paper analyzes the effect of severity of disability on labour force participation by using a self-reported work limitation scale. A dynamic labour force participation model is used to capture the feedback effect of past participation on current participation. The results suggest that net of persistence and unobserved heterogeneity, differences in severity levels explain a significant portion of the variance in the participation rates among disabled individuals. Moreover, the disability is shown to have longer lasting adverse effects on female participation and work limited women will be more likely to benefit from the work requirements imposed on Disability Support Pension recipients.severity, work disability, labour force participation

Disability and Multi-State Labour Force Choices with State Dependence

I use a dynamic mixed multinomial logit model with unobserved heterogeneity to study the impact of work limiting disabilities on disaggregated labour choices. The first seven waves of the Household Income and Labour Dynamics in Australia survey are used to investigate this relationship. Findings point out to strong state dependence in employment choices. Further, the impact of disability on employment outcomes is highly significant. Model simulations suggest that high cross and own state dependence can amplify a one-off disability shock to alter the probability of full time employment and nonparticipation permanently, especially for low skilled individuals.disability, employment, dynamic mixed multinomial logit, panel data, HILDA, simulated maximum likelihood

Why Do Past Disabilities Still Haunt the Newly Healthy?

 A dynamic labour force participation model is used to estimate the impact of disability shocks on labour force participation using a longitudinal sample drawn from the National Population Health Survey. Findings suggest that state dependence play a crucial role in how temporary disabilities can have long lasting employment effects. A disability shock that last only one period is shown to lower labour force participation up to 3 additional periods. Findings are in support of policies that promote greater labour force attachment for individuals with disabilities

Dynamics of work-limitation and work in Australia

This paper examines the impact of self-reported work-limitation on the employment of the Australian working age population. Five consecutive waves of the Household, Income and Labour Dynamics in Australia (HILDA) Survey are used to investigate this relationship. A two-equation dynamic panel data model demonstrates that persistence and unobserved heterogeneity play an important role in the work-limitation reporting and its effect on work. Unobserved factors that jointly drive work-limitation and work are also shown to be crucial, especially for women

Can Dynamic Panel Data Explain the Finance-Growth Link? An Empirical Likelihood Approach

The short run effect of the financial intermediary development on economic growth is analyzed using an unbalanced panel of 77 countries covering 35 years. Empirical Likelihood (EL) estimation is used and compared to more conventional GMM methods that weight moment conditions equally over the sample. However, if a part of the data is associated with only weak instruments, GMM estimators are subject to considerable small sample bias. EL appropriately re-weights the moment restrictions to deal with that problem. Using EL, we obtain more robust estimates of the effect of financial intermediation on economic growth than GMM

Fixed Effects Bias in Panel Data Estimators

Since little is known about the degree of bias in estimated fixed effects in panel data models, we run Monte Carlo simulations on a range of different estimators. We find that Anderson-Hsiao IV, Kivietâs bias-corrected LSDV and GMM estimators all perform well in both short and long panels. However, OLS outperforms the other estimators when the following holds: the cross-section is small (N = 20), the time dimension is short (T = 5) and the coefficient on the lagged dependent variable is large (γ = 0.8).fixed effects, panel data, LSDV, dynamic model

The dynamics of disability and work in Britain

This paper examines the dynamic relationship between work-limiting disability and labour market outcomes using longitudinal data created by matching individuals in the Local Labour Force Survey (2004–10). By applying event-study methods, changes in employment are traced through the onset of, and exit from, disability. These relationships are examined between subgroups of the population, including those defined by the nature and severity of disability. For most groups we find evidence of asymmetry in the impact of onset and exit: employment is significantly reduced at onset and continues to decline post-onset whereas, after controlling for unobserved heterogeneity, exiting disability has a limited effect

Reassessing the relationship between the financial sector and economic growth: Dynamic panel evidence

Historically, the development of the financial sector has been an indispensable driver of economic growth. In the aftermath of the Great Recession, there is a pressing need to reassess the role of the financial sector in the determination of economic growth. Using a dynamic panel framework, our analysis covers 34 European and Commonwealth of Independent States economies for the period 1998–2014 and controls for the role of macroeconomic and institutional variables. Our evidence suggests that the potential benefits of the financial sector finance may have dramatically reversed in recent years, resulting in “un-creative destruction.” The results suggest, tentatively, that there has been a severance of the link between the financial sector and the real economy. The results, however, vary according to the level of economic development across the European and Commonwealth of Independent States economies. In the case of developing market economies, the financial intermediation proxies are not significant in explaining economic growth. The effect of changes in investment expenditure, the money supply, wages, unit labour costs, and trade openness is found to be strong and in line with a priori expectations across all country samples. Notably, government consumption is also found to be a significant driver of economic growth, except in the developing market economies in the period following the Great Recession. In line with the growing consensus in other research areas, we provide evidence of a robust role for the institutional framework proxied by the quality of governance in determining economic development