The Labor Market Consequences of Receiving Disability Benefits During Childhood

Abstract

I estimate the labor market effects of gaining eligibility for Supplemental Security Income disability benefits during childhood. A Supreme Court decision eased the criteria to be considered disabled, disproportionately affecting child applicants with mental disorders. For individuals with mental disorders, each additional year of exposure to eased standards during childhood increased their SSI receipt by 0.3 years. The additional benefit receipt reduced cumulative labor market earnings through age 30 by $1,600 for each additional year of exposure for those with mental disorders. Importantly, this does not address the full range of outcomes that may be affected by receiving benefits.