Academic journal article Journal of Legal Economics

A Reply to "Does the Vocational Economic Rationale Have Merit? - an Appraisal"

Academic journal article Journal of Legal Economics

A Reply to "Does the Vocational Economic Rationale Have Merit? - an Appraisal"

Article excerpt

The Vocational Economic Rationale (VER) is the standard employed by Vocational Economics, Inc. (VEI) in conducting a Vocational Economic Assessment (VEA) when cases of permanent disability result in a lifetime loss of future earning capacity. Before any analysis of lost earnings is conducted, permanency of impairment must be established by a medical professional. Most importantly, the permanent impairment must limit the individual in terms of his or her physical, cognitive, or sensory ability, and that impairment must translate into some limitation associated with performing work.

The analysis in a Vocational Economic Assessment proceeds in a five-step process to assess the lifetime loss of future earning capacity if the requirements are met:

1. Determination of pre-injury annual earning capacity

2. Determination of pre-injury worklife expectancy

3. Determination of post-injury annual earning capacity

4. Determination of post-injury worklife expectancy

5. Present value calculation of the loss

"Does the Vocational Economic Rationale Have Merit? - An Appraisal" by Nora C. Ostrofe reviews and criticizes a version of the VER that was published in 2009. Many of the arguments in her review repeat arguments made previously in critiquing the various versions of the worklife expectancy tables for disabled individuals; such articles include: Skoog and Toppino (1999), Ciecka, Rodgers, and Skoog (2002), Jones (2005), Ireland (2009a), and Ireland (2009b). The article presents her opinions and interpretations as facts, and by doing so, much of what she says is simply in error, inaccurate, or misleading. This paper responds to the criticisms and inaccurate statements that are contained in her article.

Before the specific points are addressed, it is important to point out three facts. First, Ostrofe's appraisal considers the 2009 version of the VER (Gamboa et al. 2009). Although this is the only published version of the rationale in a professional journal (Estimating Earning Capacity: A Journal of Debate and Discussion), the VER is regularly updated and copyrighted. The most recent version of the VER, revised and copyrighted in 2014, discusses new data that has become available since 2009, and this discussion further substantiates the methodology espoused in the VER. Specifically, the American Community Survey (ACS) has continued to provide substantial evidence of the difference between non-disabled and disabled persons in both their employment levels and earnings. The most recent version of the VER cites several new research publications that have utilized the ACS data to measure the economic consequences of disabilities (Houtenville, et al. 2009; Richards and Donaldson 2010; Tennant 2012; Meyer and Mok 2013).

Next, Ostrofe presents only one side of the issues she raises by ignoring rebuttals that were published in other forensic and nonforensic journals (Gibson and Tierney 2000; Gibson 2001; Gamboa 2009). While these articles were not written in response to criticisms of the VER in particular, they do present counterpoints to the issues Ostrofe states. These articles have discussed at length such issues as: using the Current Population Survey (CPS), also referred to as the Annual Social and Economic Supplement (ASEC), as a data source to measure the effect of disability on worklife and earnings; applying a general disability status to a specific disability; and the use of a statistical average and probabilistic decision making to guide the trier of fact.

Lastly, Ostrofe's citations themselves are incorrect and make it look as if she is referencing recently added caveats (e.g., the U.S. Department of Commerce) by citing them as 2014 (her access date). These caveats, though undated, were published years earlier and have been addressed previously in both Ireland (2009b) and Gamboa (2009).

This reply to Ostrofe's appraisal addresses only the most egregious errors contained in Ostrofe's article and will not attempt to address all errors (namely, those contained in the section entitled "Meeting Daubert and Frye Criteria" that simply espouse Ostrofe's opinion). …

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