An Analysis of Durations on the Disability Support Pension (DSP) Program

Melbourne Institute Working Paper No. 08/04

Date: May 2004


Lixin Cai


The paper examines the factors that determine the duration on the Disability Support Pension (DSP) program using administrative data. We estimate two models based on two competing assumptions: the first model takes the standard assumption in duration models that all recipients will eventually leave the program. The second one takes into account the possibility that there may be some recipients who will never recover from their disabilities and hence not leave the program. Although there are differences in the results, both models indicate that female recipients, recipients who enter DSP at a young or old age, and recipients who transfer from unemployment benefits have the potential of a longer DSP duration.

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