Estimating the impact of experience rating on the inflow into disability insurance in the Netherlands
AbstractThis paper examines the effects of experience rating on the inflow into disability insurance (DI) in the Netherlands, using unique longitudinal administrative data from the Dutch social benefit administration for the years 2000-2002. We follow a difference-in-differences approach to identify the impact of changes in DI premiums. In particular, due to unawareness of the experience rating system, employers seem to have been triggered to increase preventative activities, once they have experienced increases in DI premium ('ex post incentives'). We find the impact of experience rating to be substantial, amounting to a 15% reduction of the inflow into DI. This finding is robust with respect to various alternative specification alternatives. We conclude that the decision of employers to increase preventative activities seems mainly an issue of being aware of the experience rating incentive.
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Bibliographic InfoPaper provided by CPB Netherlands Bureau for Economic Policy Analysis in its series CPB Discussion Paper with number 37.
Date of creation: Aug 2004
Date of revision:
Other versions of this item:
- Pierre Koning, 2005. "Estimating the Impact of Experience Rating on the Inflow into Disability Insurance in the Netherlands," Working Papers, Utrecht School of Economics 05-07, Utrecht School of Economics.
- H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
- I12 - Health, Education, and Welfare - - Health - - - Health Production
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-12-12 (All new papers)
- NEP-IAS-2004-12-12 (Insurance Economics)
- NEP-PBE-2004-12-12 (Public Economics)
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