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Financial Work Incentives for Disability Benefit Recipients : Lessons from a Randomized Experiment

Thiemann, Petra LU ; Lechner, Michael ; Bütler, Monika; Staubli, Stefan and Deuchert, Eva (2015) In IZA Journal of Labor Policy 4(18). p.1-18
Abstract
Disability insurance (DI) beneficiaries lose part or all of their benefits if earnings exceed certain thresholds (“cash-cliffs”). This implicit taxation is considered the prime reason for the low number of beneficiaries who expand work and reduce benefit receipt. We analyse a conditional cash programme that incentivises work related reductions of disability benefits in Switzerland. Four thousand DI beneficiaries received an offer to claim up to CHF 72,000 (USD 77,000) if they expand work and reduce benefits. Initial reactions to the programme announcement, measured by call-back rates, are modest. By the end of the field phase, the take-up rate is only 0.5 %.
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author
publishing date
type
Contribution to journal
publication status
published
subject
keywords
Disability insurance, Field experiment , Financial incentive, Return-to-work , H55, J14, C93, D04
in
IZA Journal of Labor Policy
volume
4
issue
18
pages
1 - 18
publisher
Springer
external identifiers
  • scopus:84983552151
ISSN
2193-9004
language
English
LU publication?
no
id
957913b1-5d7b-4618-9519-7956f7e85faf
date added to LUP
2017-09-06 16:37:04
date last changed
2017-11-19 04:42:57
@article{957913b1-5d7b-4618-9519-7956f7e85faf,
  abstract     = {Disability insurance (DI) beneficiaries lose part or all of their benefits if earnings exceed certain thresholds (“cash-cliffs”). This implicit taxation is considered the prime reason for the low number of beneficiaries who expand work and reduce benefit receipt. We analyse a conditional cash programme that incentivises work related reductions of disability benefits in Switzerland. Four thousand DI beneficiaries received an offer to claim up to CHF 72,000 (USD 77,000) if they expand work and reduce benefits. Initial reactions to the programme announcement, measured by call-back rates, are modest. By the end of the field phase, the take-up rate is only 0.5 %.},
  author       = {Thiemann, Petra and Lechner, Michael  and Bütler, Monika and Staubli, Stefan and Deuchert, Eva},
  issn         = {2193-9004},
  keyword      = {Disability insurance,Field experiment ,Financial incentive, Return-to-work ,H55, J14, C93, D04 },
  language     = {eng},
  number       = {18},
  pages        = {1--18},
  publisher    = {Springer},
  series       = {IZA Journal of Labor Policy},
  title        = {Financial Work Incentives for Disability Benefit Recipients : Lessons from a Randomized Experiment},
  volume       = {4},
  year         = {2015},
}