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Has Pharmaceutical Innovation Reduced Social Security Disability Growth?

Lichtenberg, Frank R (2011) Has Pharmaceutical Innovation Reduced Social Security Disability Growth? International Journal of the Economics of Business, 18 (2). pp. 293-316. ISSN 1357-1516

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Abstract

This paper analyzes longitudinal state-level data during the period 1995– 2004 to investigate whether use of newer prescription drugs has reduced the ratio of the number of workers receiving Social Security Disability Insurance benefits to the working-age population (the “DI recipiency rate”). All of the estimates indicate that there is a significant inverse relationship between disability recipiency and a good indicator of pharmaceutical innovation use: the mean vintage (FDA approval year) of Medicaid prescriptions. From 1995 to 2004, the actual disability rate increased 30%, from 2.62% to 3.42%. The estimates imply that in the absence of any post-1995 increase in drug vintage, the increase in the disability rate would have been 30% larger: the disability rate would have increased 39%, from 2.62% to 3.65%. This means that in the absence of any post-1995 increase in drug vintage, about 418,000 more working-age Americans would have been DI recipients.

Item Type: Article
Uncontrolled Keywords: ResPubID24423, pharmaceutical innovation, disability, social security
Subjects: Faculty/School/Research Centre/Department > Centre for Strategic Economic Studies (CSES)
FOR Classification > 1402 Applied Economics
SEO Classification > 970114 Expanding Knowledge in Economics
Depositing User: VUIR
Date Deposited: 18 Sep 2012 01:46
Last Modified: 18 Sep 2012 01:46
URI: http://vuir.vu.edu.au/id/eprint/9441
DOI: https://doi.org/10.1080/13571516.2011.584432
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Citations in Scopus: 3 - View on Scopus

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