SuperFreakonomics and Superficial Facts: A Defense of the ADA

This guest post is written by Thomas Tolin, Assistant Professor of Economics at West Chester University, and Martin Patwell, Director of the Office of Services for Students with Disabilities at WCU.

In the recently published SuperFreakonomics: Global Cooling, Patriotic Prostitutes, and Why Suicide Bombers Should Buy Life Insurance the authors, Steven D. Levitt and Stephen J. Dubner, make the following claim: (p. 138-139)

As we wrote earlier, the law of unintended consequences is among the most potent laws in existence… Consider the Americans with Disabilities Act (ADA), which was intended to safeguard disabled workers from discrimination. A noble intention, yes? Absolutely--but the data convincingly show that the net result was fewer jobs for Americans with disabilities. Why? After the ADA became law, employers were so worried they wouldn’t be able to discipline or fire bad workers who had a disability that they avoided hiring such workers in the first place.

We reject this argument. It is a simplification of the literature that undermines civil rights legislation for individuals with disabilities.

The starting point for this narrative is an article by Tom DeLeire (Journal of Human Resources, 2000). DeLeire concludes that following passage of the ADA there was a 7.2% decrease in the employment rates of men with disabilities relative to that of men without disabilities. DeLeire cites unpublished research by Acemoglu and Angrist to support his opposition to the ADA. Acemoglu and Angrist (Journal of Political Economy, 2001) estimate statistically significant decreases in weeks worked for younger workers with disabilities following enforcement of the law.

We agree that employment for individuals with disabilities decreased during the 1990's relative to employment of individuals without disabilities, but we do not agree that the ADA was the primary cause of this decline. To begin, the ADA was not altogether a new innovation. Following the 1973 Rehabilitation Act, eighteen states had passed ADA-style laws prior to passage of the ADA in 1990. Another twenty-nine states had anti-discrimination laws protecting individuals with disabilities, though they did not require the 'reasonable accommodations' provision found in the ADA. Only three states had no legal protections for individuals with disabilities.

Jolls and Prescott (Harvard Law and Economics Discussion Paper No. 496, 2005) use these differences between state legal regimes to study the employment effects of the ADA. They conclude that the ADA had a negative effect on employment of individuals with disabilities in states that lacked a 'reasonable accommodations' provision, but that this effect lasted only two years. They write:

Our results clearly support a causal relationship between the ADA and declines in disabled employment in the years immediately following the law’s enactment, but beyond that period our findings—contrary to the existing work by DeLeire and by Acemoglu and Angrist—indicate that disabled employment declines do not appear to be causally linked to the ADA.

There are at least two alternative explanations for the downward trend in relative employment among individuals with disabilities during the 1990s. First, eligibility requirements were relaxed in the mid-1980s for Supplemental Security Disability Insurance (SSDI) and Supplemental Security Income (SSI). More individuals with disabilities chose not to work, and this is "a much more plausible explanation ... for the decline in the relative employment of working-age men and women with disabilities since then." (Burkhauser, Houtenville, and Rovba, p 30).

Second, the 'reasonable accommodations' provision of the ADA lowered barriers to higher education. This may have increased enrollment in postsecondary institutions by students with disabilities while simultaneously decreasing employment for this group. Jolls (2004) tests this hypothesis with Current Population Survey data from the Bureau of Labor Statistics and finds some evidence supporting it: The return-to-school effect is significant in the three states with no prior legal protections for individuals with disabilities.

The return-to-school theory is consistent with Acemoglu and Angrist’s finding that the negative employment effects of the ADA were more pronounced for the 21-39 age group. It also is supported by national data from the National Center for Education Statistics: "In 1994, approximately 45 percent of persons 16 or older who reported having a disability had either attended some college or had a bachelor’s degree or higher. In contrast, 29 percent had reported doing so in 1986…" To the degree that the ADA increased educational opportunities, it has been a success.

One of the most remarkable facts about the debate surrounding the employment effects of the ADA is that employment increased during the 1990's for individuals with disabilities who claimed to be employable. According to the 2000 Harris Survey of Americans with Disabilities, there was “a significant increase in the percentage of people with disabilities who are able to work and are working, from 46% in 1986 to 56% today.” (p 28) Given that the ADA's employment provisions only protect workers who are able to work, on its own terms the law is a success.

In our opinion, a fair reading of the literature would conclude that the employment effects of the ADA are much more positive than the authors of SuperFreakonomics want readers to believe, but Levitt and Dubner ignore the complexities. They simply discredit government, even though that means rejecting legislative attempts to secure civil rights and protection from discrimination for individuals with disabilities.

Thankfully, this view certainly is not popular in the U.S. Congress. Last year, by a 420-17 vote, the Congress passed the ADA Amendments Act of 2008. Posted at the Department of Labor's website, one finds the following:

The ADAAA, Pub. L. 110-325, is intended to overturn a series of Supreme Court decisions that interpreted the Americans with Disabilities Act of 1990 in a way that made it difficult to prove that an impairment is a "disability." The ADAAA makes significant changes to the ADA's definition of "disability" that broadens the scope of coverage under both the ADA and Section 503 of the Rehabilitation Act.

In effect, the 2008 Congress said that the preceding decades had proved the point that discrimination against people with disabilities was intentional, purposeful and wrong, and that even our most respected judicial body could err where elements of civil rights and market forces clash. It would be a travesty to leave the task of promoting inclusiveness and diversity to the ‘science’ of economic positivism and to long-run, ‘rational’ market forces. Ending discrimination now is a struggle that requires a clear government mandate such as the ADA.