Research

Working papers

Is Delayed Mental Health Treatment Detrimental To Employment?

Job Market Paper (R&R at Review of Economics and Statistics)

Dutch policy article: Kans op werk daalt door lange GGZ-wachtlijsten

ESB, August 2023

Covered by Dutch newspapers Financieel Dagblad and NRC and by Radio 1

The increasing prevalence of mental health problems and limited capacity of healthcare providers have resulted in long waiting times for mental health treatment in many countries. Using administrative data on mental health treatment and labor market status for all inhabitants of the Netherlands, I find that these waiting times for mental health treatment have substantial repercussions on labor market outcomes for at least five years after the start of treatment. A two-month (one standard deviation) increase in waiting time results in a four percentage point decrease in employment probability and a two percentage point increase in the probability of disability benefit receipt. I instrument individual waiting times using regional waiting times to account for endogeneity. Furthermore, I show that vulnerable groups with low education levels or migration backgrounds are especially affected given both that the impact of waiting time is larger for them and that their average waiting time is significantly longer.

Timelapse of waiting times:

TimelapseWachttijden.mp4

Why Do Temporary Workers Have Higher Disability Insurance Risks?

Joint with Pierre Koning and Paul Muller

IZA Discussion paper series, No. 15173, March 2022

R&R at Labour Economics


Dutch policy article: Werkgeversverplichtingen bij ziekte ook effectief bij tijdelijke werknemers

Joint with Pierre Koning and Paul Muller

ESB, 107 (4810), 258-260, June 2022

Workers with fixed-term contracts typically have worse health than workers with permanent contracts. We show that these differences in health translate into a substantially higher (30%) risk of applying for DI for the Netherlands. Using unique administrative data on health and labor market outcomes of all employees in the Netherlands, we decompose this differential into: (i) selection of workers types into fixed-term contracts; (ii) the causal impact of temporary work conditions on worker health; (iii) the impact of differential employer incentives to reintegrate ill workers; and (iv) the differential impact of labor market prospects on the decision to apply for DI benefits. We find that selection actually masks part of the DI risk premium, whereas the causal impact of temporary work conditions on worker health is limited. At the same time, the differences in employer commitment during illness and differences in labor market prospects between fixed-term and permanent workers jointly explain almost 90% of the higher DI risk.

Work in progress

Sick or Unemployed? Examining Transitions into Sickness Insurance At Unemployment Benefit Exhaustion

Joint with Pierre Koning

While there is evidence of ``spikes'' of exits into employment at Unemployment Insurance (UI) benefit exhaustion, the presence and implications of concurrent strong increases in exits out of the labor force are less well understood. Using Dutch administrative data, we document such a spike of out-of-labor force exits into Sickness Insurance (SI) at the moment of UI benefit exhaustion, equal to about 130% of pre-spike inflow rates. Comparing the spike cohort into SI to pre-spike cohorts, we show that differences in terms of healthcare utilization and demographics at the end of the UI benefit period are limited. As an exception to this, we find the share of migrants in the spike cohort to be substantially higher. Once workers start receiving SI benefits, however, we see that workers in the spike are less likely to exit SI and more likely to be awarded disability benefits after two years of SI receipt. These differences already materialize in the first four months of SI receipt, with ``stayers'' in the spike that use significantly less healthcare but probably have weaker labor market positions. External screening after 12 months of SI receipt has more impact on the spike cohort and partly offsets the differences in health conditions between the cohorts. 

Activating rejected DI applicants: The impact of additional reintegration services

Joint with Pierre Koning

Individuals whose application for disability insurance (DI) benefits is rejected often end up on unemployment insurance (UI) benefits . Standard reintegration services offered to UI recipients are however often not effective for these rejected DI applicants. In this project, we evaluate a policy reform which increased the provision of reintegration services to rejected DI applicants in the Netherlands. We first assess which subgroups are likely to make use of these services, and secondly, we assess the effectiveness of the additional service provision on both employment outcomes and on healthcare utilisation.

The long-term consequences of mental health screening in high school

While the prevalence of mental health issues is high during childhood, only half of all children suffering from these issues receive treatment. The uptake of treatment is lower among children with low SES and/or migration backgrounds. This could potentially further increase inequality in later-in-life outcomes. This project analyses the introduction of preventative mental health screening for all 15/16-year-old high school students in the Netherlands. As a first step, the impact on the actual uptake of treatment, and inequality in this uptake is estimated. The second step examines whether preventive mental health screening also has long-term (10 years) effects on educational and labour market outcomes.

Publications

Do Disability Benefits Hinder Work Resumption After Recovery?

Joint with Pierre Koning and Paul Muller

Journal of Health Economics, Volume 82, March 2022

2021/2022 SBE-Tinbergen best PhD publication award

While a large share of Disability Insurance recipients in OECD countries are expected to recover, outflow rates from temporary disability schemes are typically negligible. We estimate the disincentive effects of disability benefits on the response to a (mental) health improvement using administrative data on all Dutch disability benefit applicants. We compare those below the DI eligibility threshold with those above and find that disincentives significantly reduce work resumption after health improves. Approximately half of the response to recovery is offset by benefits. Estimates from a structural labor supply model suggest that disincentives are substantially larger when the worker's earnings capacity is fully restored.tem