Assessing the Effect of a Compulsory Sickness Insurance on Worker Absenteeism

Stockholm School of Economics Working Paper No. 287

37 Pages Posted: 12 Jul 1999

See all articles by Per Johansson

Per Johansson

IFAU - Institute for Labour Market Policy Evaluation; Uppsala University - Department of Economics; IZA Institute of Labor Economics

Marten Palme

Stockholm University - Department of Economics; IZA Institute of Labor Economics

Date Written: December 1998

Abstract

The effect of economic incentives on worker absenteeism is analyzed using panel data on work absence behavior for each day during 1990 and 1991 (i.e., 730 observations in the time dimension) for a representative sample of 1,396 Swedish blue collar workers. During the observed time period, a major reform of the sickness insurance as well as a tax reform were implemented, both of which affected the worker's cost of being absent from work. We differentiate between the dynamic dependence conditional on whether the worker is in the work absence state versus in the work presence state. We also control for unobserved heterogeneity. The results show that the cost of being absent has a significant effect on work absence behavior and the importance of considering unobserved heterogeneity when modeling individual work absence behavior.

JEL Classification: C25, C33, J22, J28

Suggested Citation

Johansson, Per and Palme, Marten, Assessing the Effect of a Compulsory Sickness Insurance on Worker Absenteeism (December 1998). Stockholm School of Economics Working Paper No. 287, Available at SSRN: https://ssrn.com/abstract=163529 or http://dx.doi.org/10.2139/ssrn.163529

Per Johansson

IFAU - Institute for Labour Market Policy Evaluation ( email )

Box 513
751 20 Uppsala
Sweden
+ 46 18 471 70 86 (Phone)
+ 46 18 471 70 71 (Fax)

Uppsala University - Department of Economics ( email )

Uppsala, 751 20
Sweden

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Marten Palme (Contact Author)

Stockholm University - Department of Economics ( email )

Universitetsvägen 10 A
House A, floor 4 and 7
Frescati, Stockholm
Sweden
+46163307 (Phone)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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