Sick of Being Unemployed? Interactions between Unemployment and Sickness Insurance

18 Pages Posted: 8 May 2006

See all articles by Laura Larsson

Laura Larsson

IFAU - Office of Labour Market Policy Evaluation

Abstract

This paper examines the incentive effects of interactions between unemployment insurance (UI) and sickness insurance (SI), two important components of Sweden's social insurance system. The main topic is how the sickness-report rate among the unemployed is affected by (i) the limit of 300 workdays for UI benefits, and (ii) the difference in maximum compensation between UI and SI benefits. Results obtained by duration analysis suggest that sick reports increase as the UI benefit expiration date approaches. There is also evidence of an incentive effect on the sick-report rate because SI offers higher compensation than UI.

Suggested Citation

Larsson, Laura, Sick of Being Unemployed? Interactions between Unemployment and Sickness Insurance. Scandinavian Journal of Economics, Vol. 108, No. 1, pp. 97-113, March 2006, Available at SSRN: https://ssrn.com/abstract=901047 or http://dx.doi.org/10.1111/j.1467-9442.2006.00443.x

Laura Larsson (Contact Author)

IFAU - Office of Labour Market Policy Evaluation ( email )

Box 513
751 20 Uppsala
Sweden
+46 18 471 70 82 (Phone)

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