Disability and work in Sweden

University dissertation from Stockholm : Stockholm University

Abstract: Occupational Attainment and Earnings ( the Case of the Disabled This paper offers, for the first time, estimates of the extent of unexplained wage differentials between disabled and nondisabled workers in Sweden. According to studies of wage differentials between disabled and nondisabled workers in the United States, the unexplained component accounts for almost 50 per cent of the differential between the two groups. However, these studies ignore such potential differences in occupational attainment as are not explained by differences in occupational qualifications. Using a technique developed by Brown et al. (1980), this paper extends the traditional wage decomposition by incorporating explained and unexplained differences in occupational attainment. Data from the Swedish Level of Living Survey for 1981 and for 1991 have been used. The results show that in both years the disabled worked in low-level occupations to a greater extent relative to the nondisabled. This is due to the fact that disabled workers have lower qualifications. The unexplained component due to differences in returns on wage determinants is insignificant in the 1981 case but is highly significant in 1991, constituting around 50-60 per cent of the average log wage differential.Economic Incentives: Do they Affect the Likelihood of a Disability Pension Being Granted? An ageing population and a growing number of people leaving the labour market mean that more and more elderly people become dependent on a shrinking labour force. It is thus important to understand the process whereby disability pensions are granted, in order to formulate a policy that strikes a balance between economic security and incentives to work. This paper studies the possible effect of the economic incentives present in the Swedish disability pension system on the probability of a disability pension being granted. A mixed conditional logit model incorporating various predicted income levels is used to estimate this probability. A sample consisting of workers aged 25-64 from the 1981 Swedish Level of Living Survey, of whom 8 per cent were granted disability pensions during the 1980s, has been used. The results indicate that economic incentives do have a significant and positive, albeit quantitatively small, effect on the likelihood of a disability pension being granted.The Role of Caseworkers in Selecting Candidates for a Vocational Rehabilitation Project Very little is known about the way labour market programme participants are selected for the programmes. This paper studies how caseworkers selected candidates for a vocational rehabilitation project for the disabled. The caseworkers had been given four rules for eligibility: a severe disability, a recently granted disability pension, participation in an education programme and regular employment should all disqualify from participation. The paper investigates various aspects of the way the caseworkers followed or broke these rules, and whether they selected the most employable candidates. The data used has been taken from register data at the National Social Insurance Board, the same data that was used by the caseworkers in selecting the candidates. The results show that the caseworkers did not always follow the rules and that they based their decisions on factors other than those implicit in the rules. Some of these factors suggest that they wanted the most employable to participate in the project.

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