Economic Theories of Disability Benefits

Abstract

Within government social welfare policies and programs, disability has frequently been defined and addressed as an economic issue, linked to the ability (or inability) to work. This article comprises a brief review of literature concerned with economic theories related to disability, with a primary focus on public disability benefits. The explanatory theories of rational choice, supply and demand, and moral hazard are discussed in the context of disability benefits and the normative fields of welfare economics and social choice theory as they relate to disability. Finally, implications of the economic perspective for the analysis of human behavior and the social environment are identified.

KEYWORDS:

• Disability
• economic
• theory
• public benefits
• employment
• moral hazard
• rational choice
• social choice