TY  - JOUR
AU  - Bingley, Paul
AU  - Gupta, Nabanita Datta
AU  - Jorgensen, Michael
AU  - Pedersen, Peder
TI  - Health, Disability Insurance and Retirement in Denmark
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 20114
PY  - 2014
Y2  - May 2014
DO  - 10.3386/w20114
UR  - http://www.nber.org/papers/w20114
L1  - http://www.nber.org/papers/w20114.pdf
N1  - Author contact info:
Paul Bingley
Prins Knuds Vej 47
Risskov 8240
DENMARK
Tel: +4533480937
E-Mail: pab@vive.dk

Nabanita Datta Gupta
Department of Economics and 
  Business Economics
Aarhus University 
Fuglesangs Allé 4
8210 Aarhus V
Denmark
E-Mail: ndg@econ.au.dk

Michael Jorgensen
The Danish National Centre for Social Research
Stradellasvej 26 1. TH
2450 København SV
Denmark
E-Mail: mic@sfi.dk

Peder Pedersen
Department of Economics and 
  Business Economics
Aarhus University 
Fuglesangs Allé 4
8210 Aarhus V
Denmark
Tel: +4589421581
E-Mail: ppedersen@econ.au.dk
M1  - published as Paul Bingley, Nabanita Datta Gupta, Michael Jørgensen, Peder J. Pedersen. "Health, Disability Insurance, and Retirement in Denmark," in David A. Wise, editor, "Social Security Programs and Retirement Around the World: Disability Insurance Programs and Retirement" University of Chicago Press (2016)

M3  - presented at "International Social Security", September 26-28, 2013
AB  - There are large differences in labor force participation rates by health status. We examine to what extent these differences are determined by the provisions of Disability Insurance and other pension programs. Using administrative data for Denmark we find that those in worse health and with less schooling are more likely to receive DI. The gradient of DI participation across health quintiles is almost twice as steep as for schooling - moving from having no high school diploma to college completion. Using an option value model that accounts for different pathways to retirement, applied to a period spanning a major pension reform, we find that pension program incentives in general are important determinants of retirement age. Individuals in poor health and with low schooling are significantly more responsive to economic incentives than those who are in better health and with more schooling. Similar gradients in outcomes and behavior by health and schooling partially reflects the less educated having poorer health on average, but also that the less educated have worse job prospects and higher replacement rates due to a progressive formula for DI and other pension benefits.
ER  -