Disabled Workers and the Indexing of Social Security Benefits

We show the distributional effects of changing the Social Security indexing scheme with an emphasis on the effects upon disabled-worker beneficiaries. Although a class of reform proposals that would slow the rate of growth of initial benefit levels over time - including price indexing and longevity indexing - initially appears to affect all beneficiaries proportionally, there can be different impacts on different groups of beneficiaries. The impacts between and within groups are mitigated by the offsetting effect of changes in Supplemental Security Income benefits and the dampening effect of other family income. We present estimates of the size of these effects