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Cessation of Activity Benefit for Spanish Self-employed Workers: A Heterogeneous Impact Evaluation

Author

Listed:
  • Ignacio Moral-Arce

    (Instituto de Estudios Fiscales)

  • Javier Martín-Román

    (Universidad Nacional de Educación a Distancia)

  • Ángel L. Martín-Román

    (Universidad de Valladolid)

Abstract

The goal of this paper is to evaluate the effects of a public policy implemented through the Spanish Social Security system: the Cessation of Activity Benefit (CAB) for self-employed workers. Making use of the Continuous Sample of Working Lives (MCVL) and by means of a Propensity Score Match-ing (PSM) methodology, our results show that, when we do not take into account heterogeneity in the treatment, self-employed workers receiving CAB experience non-employment spells between 33 and 38 logarithmic points longer than their not entitled counterparts. We also detect that this difference is not constant but depends on the likelihood of being treated. We believe that the two traditional prob-lems that affect the insurance markets, consequence of the asymmetric information, adverse selection and moral hazard, are behind these results.

Suggested Citation

  • Ignacio Moral-Arce & Javier Martín-Román & Ángel L. Martín-Román, 2019. "Cessation of Activity Benefit for Spanish Self-employed Workers: A Heterogeneous Impact Evaluation," Hacienda Pública Española / Review of Public Economics, IEF, vol. 231(4), pages 41-79, December.
    • Handle: RePEc:hpe:journl:y:2019:v:231:i:4:p:41-79
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    More about this item

    Keywords

    Self-employment; impact evaluation; propensity score matching; opportunistic Behavior;
    All these keywords.

    JEL classification:

    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law
    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation

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