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Sickness insurance and spousal labour supply

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  • Olsson, Martin
  • Skogman Thoursie, Peter

Abstract

Analysing a reform in the Swedish public sickness insurance, we find that an increased replacement rate for one spouse has a negative cross effect on the other spouse's labour supply. The cross effects are present in the labour supply margins that workers can easily adjust. For wives of treated husbands, the total number of sick days increases on average 9.1% per month, whereas labour earnings are unchanged. The cross effect on total sick days for husbands to treated wives is 6.1% on average, with no effect on annual labour earnings. The total number of sick days and annual labour earnings for treated spouses are estimated to be unaffected by the reform, which indicates that the cross effects stem specifically from higher insurance coverage for the couples.

Suggested Citation

  • Olsson, Martin & Skogman Thoursie, Peter, 2015. "Sickness insurance and spousal labour supply," Labour Economics, Elsevier, vol. 33(C), pages 41-54.
    • Handle: RePEc:eee:labeco:v:33:y:2015:i:c:p:41-54
    DOI: 10.1016/j.labeco.2015.02.005
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    References listed on IDEAS

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    Cited by:

    1. Fadlon, Itzik & Nielsen, Torben Heien, 2019. "Household labor supply and the gains from social insurance," Journal of Public Economics, Elsevier, vol. 171(C), pages 18-28.
    2. Kieu‐Dung Nguyen & Van‐AnhThi Tran & Duc‐Thanh Nguyen, 2021. "Social insurance reform and absenteeism in Vietnam," International Journal of Social Welfare, John Wiley & Sons, vol. 30(2), pages 193-207, April.
    3. Nicolas R. Ziebarth, 2018. "Social Insurance and Health," Contributions to Economic Analysis, in: Health Econometrics, volume 127, pages 57-84, Emerald Group Publishing Limited.
    4. Nie, Pu-yan & Wang, Chan & Chen, Zi-yue & Chen, You-hua, 2018. "A theoretic analysis of key person insurance," Economic Modelling, Elsevier, vol. 71(C), pages 272-278.
    5. Lluis, Stephanie & McCall, Brian, 2022. "Spousal labour supply adjustments to extended benefits weeks: Evidence from Canada," CLEF Working Paper Series 42, Canadian Labour Economics Forum (CLEF), University of Waterloo.
    6. Stephanie Lluis & Brian McCall, "undated". "Spousal Labour Supply Adjustments," Working Papers 1810, University of Waterloo, Department of Economics.

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    More about this item

    Keywords

    Spousal labour supply; Sickness insurance; Cross effects;
    All these keywords.

    JEL classification:

    • D10 - Microeconomics - - Household Behavior - - - General
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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