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The labor market effects of national health insurance: evidence from Taiwan

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  • Kamhon Kan
  • Yen-Ling Lin

Abstract

This paper investigates the impacts of national health insurance on the labor market, by considering the case of Taiwan, which implemented national health insurance in March 1995. Taiwan’s national health insurance is financed by premiums, which are proportional to an employee’s salary. These premiums may introduce distortions to the labor market. Based on repeated cross-sections of individual data we find that, on average, private sector employees’ work hours declined relative to their public sector counterparts, while their relative wage rates were almost unchanged with the introduction of national health insurance. The results suggest that neither private sector employers nor their employees were able to shift their premium burden to each other.
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Suggested Citation

  • Kamhon Kan & Yen-Ling Lin, 2009. "The labor market effects of national health insurance: evidence from Taiwan," Journal of Population Economics, Springer;European Society for Population Economics, vol. 22(2), pages 311-350, April.
    • Handle: RePEc:spr:jopoec:v:22:y:2009:i:2:p:311-350
    DOI: 10.1007/s00148-007-0135-x
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    Cited by:

    1. Hsin-Ling Hsieh & Shin-Yi Chou & Echu Liu & Hsien-Ming Lien, 2015. "Strengthening or Weakening? The Impact of Universal Health Insurance on Intergenerational Coresidence in Taiwan," Demography, Springer;Population Association of America (PAA), vol. 52(3), pages 883-904, June.
    2. Shao-Hsun Keng & Shin-Yi Wu, 2014. "Living Happily Ever After? The Effect of Taiwan’s National Health Insurance on the Happiness of the Elderly," Journal of Happiness Studies, Springer, vol. 15(4), pages 783-808, August.
    3. Nga Le Thi Quynh & Groot, Wim & Tomini, Sonila M. & Tomini, Florian, 2017. "Effects of health insurance on labour supply: A systematic review," MERIT Working Papers 2017-017, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    4. Yu-Chen Kuo & Jia-Huey Lin, 2020. "Picking the lock: how universal healthcare programs influence entrepreneurial activities," Small Business Economics, Springer, vol. 54(1), pages 3-24, January.

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    More about this item

    Keywords

    National health insurance; Labor supply; Difference-in-difference; J22; J31; I38;
    All these keywords.

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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