Boundaries between public and private welfare

CASEbrief01 is a detailed summary of CASEpaper 02, 'Boundaries between public and private welfare: a typology and map of services', by Tania Burchard

The dynamics of being disabled

Government policies on disability - and criticism of them - rest in part on an understanding of the circumstances of disabled people informed by cross-sectional survey data, dividing the population into 'the disabled' and 'the non-disabled'. While conceptual debates about the nature of disability and associated measurement problems have received some attention, the dynamic aspect of disability has been largely overlooked. This paper uses two approaches to longitudinal data from the British Household Panel Survey to investigate the complexity behind the snapshot given by cross-sectional data. First, a detailed breakdown is given of the working-age population who are disabled at any one time by the 'disability trajectories' they follow over a seven-year period. Second, the expected duration of disability for those who become disabled during working life is examined. The results show that only a small proportion of working age people who experience disability are long-term disabled, despite the fact that at any one time, long-term disabled people make up a high proportion of all disabled people. Over half of those who become limited in activities of daily living as adults have spells lasting less than two years, but few who remain disabled after four years recover. Intermittent patterns of disability, particularly due to mental illness, are common. The assumption, contrary to evidence presented in this paper, that 'once disabled, always disabled' has lead to disability benefits being seen as a one-way street, an outcome which marginalises disabled people and is costly for the benefit system. In addition, eligibility criteria for disability benefits and employment support for disabled people often do not reflect the non-continuous nature of some disability. Policies which fail to distinguish between the different trajectories which disabled people follow are unlikely to be successful

The Dynamics of Being Disabled

Government policies on disability - and criticism of them - rest in part on an understanding of the circumstances of disabled people informed by cross-sectional survey data, dividing the population into 'the disabled' and 'the non-disabled'. While conceptual debates about the nature of disability and associated measurement problems have received some attention, the dynamic aspect of disability has been largely overlooked. This paper uses two approaches to longitudinal data from the British Household Panel Survey to investigate the complexity behind the snapshot given by cross-sectional data. First, a detailed breakdown is given of the working-age population who are disabled at any one time by the 'disability trajectories' they follow over a seven-year period. Second, the expected duration of disability for those who become disabled during working life is examined. The results show that only a small proportion of working age people who experience disability are long-term disabled, despite the fact that at any one time, long-term disabled people make up a high proportion of all disabled people. Over half of those who become limited in activities of daily living as adults have spells lasting less than two years, but few who remain disabled after four years recover. Intermittent patterns of disability, particularly due to mental illness, are common. The assumption, contrary to evidence presented in this paper, that 'once disabled, always disabled' has lead to disability benefits being seen as a one-way street, an outcome which marginalises disabled people and is costly for the benefit system. In addition, eligibility criteria for disability benefits and employment support for disabled people often do not reflect the non-continuous nature of some disability. Policies which fail to distinguish between the different trajectories which disabled people follow are unlikely to be successful.Disability, panel data, survival analysis

The Evolution of Disability Benefits in the UK: Re-weighting the basket

This paper attempts to clarify the significance of reforms to disability benefits proposed by the New Labour government in 1998, by setting them in the context of the development of disability benefits in the early 1970s. The first two sections chart the creation, extension and subsequent reforms of disability benefits. Hypothetical case studies are then used to illustrate the changing balance between different kind of benefit for disabled people. The paper concludes that, in accordance with the guiding principle of welfare reform, 'work for those who can and security for those who cannot', the government's reforms are designed to reward paid employment, while offering relatively generous provision for those who are obviously unable to work. The question raised is the extent to which altered incentives will be sufficiently powerful to eliminate the category in-between-those who are deemed capable of work but who do not have a job - or whether large numbers of disabled people will fall between the stools of 'work' and 'security'.Disability benefits, welfare reform

One man's rags are another man's riches: Identifying adaptive preferences using panel data

One of the motivations frequently cited by Sen and Nussbaum for moving away from a utility metric towards a capabilities framework is a concern about adaptive preferences or conditioned expectations. If utility is related to the satisfaction of aspirations or expectations, and if these are affected by the individual's previous experience of deprivation or wealth, then utility cannot provide a basis for assessing well-being, equality or social justice which is independent of the initial distribution. This paper contributes to the identification of adaptive expectations by using ten years of panel data from the British Household Panel Survey to study the process of adaptation based on the individual's own previous experience. Subjective assessments of financial well-being at time t, for individuals with a given income level, are compared according to the income trajectory of the individual over the previous one to nine years. Descriptive statistics are followed by multivariate analysis, introducing controls for changes in need (family size and composition, disability), and possible social reference groups (for example, ethnicity and employment status). Fixed effects regressions allow for individual variation in the scaling of satisfaction. The results show that year on year, individuals who have experienced a fall in income since the previous year are less satisfied than those who have a steady income, suggesting that subjective assessments may be made in comparison with previous experience. Surprisingly, individuals who have experienced an increase in income are also less satisfied. This suggests that income is a poor proxy for satisfaction but it does not provide firm evidence for the existence of adaptation over the short term. Over a longer period, those who have experienced falling incomes are less satisfied than those who have had constant income, while those who have experienced rising incomes are no more satisfied than those who have had constant incomes. This suggests that over a longer period, adaptation to changes in income is asymmetric: people adapt to rising incomes but less so falling incomes. The paper concludes that satisfaction with income is influenced by objective circumstances, and to changes in objective circumstances, in complex ways. In particular, the process of adaptation to rises in income masks long-term differences in outcomes for individuals and makes subjective assessments of well-being a flawed basis for judgements of inequality or social justice. An objective normative standard, such as is offered by the capabilities framework, avoids social evaluations being unduly influenced by individuals' past experiences.Adaptation, subjective well-being, satisfaction, income, panel data

Foundations for measuring equality: A discussion paper for the Equalities Review

The Equalities Review is an independent panel set up by the UK government in 2005 to investigate the persistence of social inequalities and to make recommendations for the development of a unified Commission for Equality and Human Rights. This paper was originally written for the Review. It canvasses possible responses to the questions, 'equality between whom?' and 'equality of what?'. It argues that equality of outcome is intuitively appealing but risks ignoring variations in need, differences in values and preferences, and the importance of individual agency. A broad interpretation of equality of opportunity, such as is provided by the capability approach, can address these limitations, by focusing on the substantive freedom enjoyed by individuals. Substantive freedom may be limited by a lack of personal resources, or by the economic, social, political, cultural, and environmental conditions context in which the individual is operating. The paper concludes by identifying, and indicating solutions to, a number of measurement issues that arise in operationalising the capability approach.Equality, opportunity, capability approach

Comparing incomes when needs differ: equivalisation for the extra costs of disability in the UK

Equivalisation of incomes for household size and composition is accepted practice when measuring poverty and inequality; adjustments to take account of other variations in needs are rarely made. This paper explores the financial implications of one possible source of additional needs: disability. Using two UK household surveys, we seek to establish whether there are extra costs of living associated with disability, and to quantify them using the ¿standard of living¿ approach. The underlying theory is that a household¿s standard of living is a function of income and needs. The extra costs of disability can be derived by comparing the standard of living of households with and without disabled members at a given income, having controlled for other sources of variation. Results show that the extra costs of disability are substantial, especially for disabled people living alone, and that these costs rise with severity of disability. To bring out the policy implications of these results, we compare and contrast three different income distributions which differ in their adjustment for the extra costs of disability, for the population as a whole and for various subgroups. We find that unadjusted incomes significantly understate the problem of low income amongst disabled people, and thereby in the population as a whole

Comparing incomes when needs differ: Equivalisation for the extra costs of disability in the UK

Equivalisation of incomes for household size and composition is accepted practice when measuring poverty and inequality; adjustments to take account of other variations in needs are rarely made. This paper explores the financial implications of one possible source of additional needs: disability. Using two UK household surveys, we seek to establish whether there are extra costs of living associated with disability, and to quantify them using the 'standard of living' approach. The underlying theory is that a household's standard of living is a function of income and needs. The extra costs of disability can be derived by comparing the standard of living of households with and without disabled members at a given income, having controlled for other sources of variation. Results show that the extra costs of disability are substantial, especially for disabled people living alone, and that these costs rise with severity of disability. To bring out the policy implications of these results, we compare and contrast three different income distributions which differ in their adjustment for the extra costs of disability, for the population as a whole and for various subgroups. We find that unadjusted incomes significantly understate the problem of low income amongst disabled people, and thereby in the population as a whole.Equivalisation, disability, standard of living, income distribution

Incomes, functionings and capabilities: the well-being of disabled people in Britain

The central objective of this thesis is to explore whether the capability approach can be operationalised, using the well-being of disabled people in Britain as a case study. The capability approach proposes a shift away from measuring utility and income poverty towards identifying functionings (the states of being and activities which individuals achieve), and capabilities (the different combinations of functionings which individuals have the opportunity to achieve). To date there have been few empirical applications and many concerns about the usefulness of the approach remain. Disabled people are an interesting case study for the capability approach because of the challenge to conventional measures of well-being issued by the social model of disability: that we should move away from measuring individual deficits towards focusing on the barriers individuals with impairments experience in attempting to lead the lives they want to lead. The capability approach has the potential, in theory, to meet this challenge. In addition to providing in-depth analysis of the position of disabled people in society, the thesis makes three contributions, one theoretical and two methodological. The theoretical development is the distinction between capability as opportunity and capability as autonomy, that is, the distinction between an approach which treats preferences as exogenous and one which takes seriously the problem of conditioned expectations. The innovative methodologies are, firstly, the extension of techniques of equivalisation of income to take account of variations in needs due to disability, and, secondly, quantifying whether a particular functioning is within an individual's capability set. The thesis concludes that relatively straightforward adjustments to conventional poverty measures improve their validity. For fuller application of the capability approach, although there is a trade-off between conceptual soundness and complexity of data requirements, informative measures of opportunity and autonomy can be derived from existing survey data