The importance of net benefit levels in disability program applications : evidence from the Civil War pension system

This study uses Civil War pension records to infer the effect of net replacement rates on timing of pension applications. The analysis focuses on a change in eligibility standards to understand application behavior for newly eligible veterans. A standard Cox proportional hazard model is employed to estimate the marginal effect of implicit application costs and wage determinants on application timing. This study finds that determinants which lower net benefits, namely living in the West, living in urban centers, and working in white collar jobs systematically delay pension applications.