Resumen de Is there an earnings loss before becoming disabled?

María Cervini Plá, Judit Vall Castello

• Although a number of papers in the literature have shown the employment and wage differences between disabled and non-disabled individuals, not much is known about the differences before entering the disability system. Therefore, in this paper we make use of a large microeconomic dataset from the Spanish Social Security administration and apply matching models to compare the annual earnings growth of individuals who are disabled due to a working accident (sudden health shock) to those that become disabled due to an ordinary illness. Our results reinforce the findings of Kofi Charles (2003) and show that the wage growth patterns of both groups of workers become significantly different four years before entering the DI system although these differences start to accelerate from the third year before DI. Our estimates suggest that one year before entering the system, there is a difference of 47 euros/month in the wages of the two groups.