Does Welfare Inhibit Success? The Long-Term Effects of Removing Low-Income Youth from the Disability Rolls

Am Econ Rev. 2016 Nov;106(11):3300-30. doi: 10.1257/aer.20151129.

Abstract

I estimate the effects of removing low-income youth with disabilities from Supplemental Security Income (SSI) on their earnings and income in adulthood. Using a regression discontinuity design based on a 1996 policy change in age 18 medical reviews, I find that youth who are removed from SSI at age 18 recover one-third of the lost SSI cash income in earnings. SSI youth who are removed and stay off SSI earn on average $4,400 annually, and they lose $76,000 in present discounted observed income over the 16 years following removal relative to those who do not receive a review.

MeSH terms

  • Adolescent
  • Disability Evaluation
  • Eligibility Determination
  • Employment* / economics
  • Employment* / statistics & numerical data
  • Humans
  • Income / statistics & numerical data*
  • Insurance, Disability* / economics
  • Insurance, Disability* / statistics & numerical data
  • Persons with Disabilities / statistics & numerical data*
  • Poverty* / economics
  • Poverty* / statistics & numerical data
  • Social Security
  • Social Welfare* / economics
  • Social Welfare* / statistics & numerical data
  • Young Adult