Table 1

Studies investigating policy changes and differences between jurisdictions in Canada

AuthorPopulationStudy typeType of policy variation and disability benefit scheme investigatedResult: regression coefficient (p value)CommentsVA
Campolieti (2004)36Men aged 45–64 yearsDifferences-in-differences with individual dataVariation in benefit generosity only. QPP 1973Linear regression of policy change on non-employment.
45–64 year olds: 0.008 (p=0.3).
45–59 year olds: 0.001 (p=0.48)
The authors concluded that all the difference-in-difference estimates suggested that the disincentive effects associated with disability benefits would be economically small and not statistically significant at that time. No control for health status.13
Campolieti and Goldenberg, (2007)45Men and women 45–64 years oldDifferences-in-differences with individual dataVariation in eligibility requirements only. CPP/QPP 1994 to 1999Linear regression of benefit rejection rates on non-participation.
Men 0.646 (p=0.166).
Women 0.02 (p=0.297)
The authors concluded that they did not find a statistically significant negative relationship between denial rates and the labour force non-participation of older men and women. Health status not sufficiently controlled.13
Harkness (1993)38Prime aged men with self-reported disabilityCross-sectional surveyVariation in benefit generosity only. Multiple benefits 1986Logistic regression of benefit level on labour force participation.
−0.00019 (p=0.006) Benefit elasticity − 2.03 Wage elasticity 6.33
The authors concluded that disability benefits did discourage work, but the disincentive effects of low wages were greater. Level of education not controlled for in labour market participation model.11
Gruber (2000)37Men 45–59 yearsDifferences-in-differences with individual dataVariation in benefit generosity only. CPP 1987Logistic regression of policy and replacement rate on non-labour market participation in two separate models.
Policy change 0.15 (OR 1.16) (p=0.02).
Replacement rate 1.344 (OR 3.8) (p=0.009).
Elasticity 0.28
The authors concluded that both models showed a significant effect of increases in benefit levels and the replacement rate in reducing labour market participation. Health status not controlled.11
Campolieti, (2003)44Men aged 45–64 yearsDifferences-in-differences with individual dataVariation in eligibility requirements only. CPP 1989Linear regression of policy change on labour market non-participation.
0.015 (p=0.016)
The authors concluded that the relaxation in eligibility requirements reduced the labour supply of older men in Canada by 1.5%. Health status, wages and benefit levels not controlled.11
Campolieti, (2001)47Men and women 45–64 yearsDifferences-in-differences with ecological dataVariation in both eligibility requirements and benefit generosity as separate parameters in the same model
  1. CPP/QPP average replacement rate 1983 to 1997.

  2. CPP relaxed eligibility criteria 1987 to 1994

  3. QPP relaxed eligibility 1993 to 1997

  4. QPP early retirement provision 1984 to 1997

Linear regression on labour force participation Men
  1. Men: − 0.2450 (p=0.09), women: 0.1341 (p=0.052)

  2. Men: 0.0251(p=0.04), women: −0.0088 (p=0.9)

  3. Men: −0.0082 (p=0.2), women: 0.0142 (p=0.02)

  4. Men: −0.0478 (p<0.001), women: 0.0008 (p=0.4)

The authors concluded that some of these estimates did not support the hypothesis that looser eligibility rules decrease participation rates since they were not statistically significant or did not have the expected sign. The change in replacement rate was not significant for men in the full model. Increasing replacement rates were associated with increased employment in women in the full model, although this was not significant. Education level was not controlled for in the models and the health status control was inadequate.10
Campolieti (2001)4645–64-year-old menDifferences-in-differences with ecological dataVariation in both eligibility requirements and benefit generosity as separate parameters in the same model.
  1. CPP/QPP replacement rate of benefits (1983 to 1997)

  2. CPP period of relaxed eligibility (1987 to 1994)

Linear regression on labour force participation
  1. −0.2171 (p=0.009)

  2. 0.0149 (p=0.051)

The relaxed eligibility requirements in the CPP disability programme did not have the expected sign in any of the regressions. The replacement rate was significantly associated with a decline in participation rates. However, these coefficient estimates were smaller and not statistically significant when the year-specific effects were used instead of the linear time trend. Education level was not controlled for in the models and the health status control (regional mortality rate) was inadequate.9
Maki (1993)39Men aged 45–64 years oldTime series ecologicalVariation in benefit generosity only CPP/QPP 1975 to 1983Linear regression of average monthly benefit payments as a ratio to wages on labour force participation.
−0.2 (p<0.001)
The authors concluded that higher rates of benefits were significantly associated with lower employment. Health status and education level not sufficiently controlled.8
  • CPP, Canadian pension plan; QPP, Quebec pension plan; VA, validity assessment.