In many countries, a non-negligible percentage of the working-age population has impairments that also entail reduced work capacity, and disability retirement is increasing. Despite this, studies on the effects of policies aimed at enhancing the labour market inclusion among people with...

Background: In response to increases in the number of people in receipt of disability benefits many countries have reduced their income replacement rate in order to increase employment incentives. Using new OECD data on disability benefit income replacement rates, we investigate the relationship...