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The Effects of Expanding the Generosity of the Statutory Sickness Insurance System

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  • Nicolas R. Ziebarth
  • Martin Karlsson

Abstract

In 1999, in Germany, the statutory sick pay level was increased from 80 to 100 percent of foregone earnings for sicknessepisodes of up to six weeks. We show that this reform has led to an increase in average absence days of about 10 percent or one additional day per employee, per year. The estimates are based on SOEP survey data and parametric, nonparametric, and combined matching-regression difference-in-differences methods. Extended calculations suggest that the reform might have increased labor costs by about EUR1.8 billion per year and might have led to the loss of around 50,000 jobs.

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Paper provided by DIW Berlin, The German Socio-Economic Panel (SOEP) in its series SOEPpapers on Multidisciplinary Panel Data Research with number 245.

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Length: 32 p.
Date of creation: 2009
Date of revision:
Handle: RePEc:diw:diwsop:diw_sp245

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Keywords: Sickness absence; statutory sick pay; natural experiment; Socio-Economic Panel Study (SOEP);

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Cited by:
  1. Edmundo Beteta & Manuel Willington, 2009. "Planes Mínimos Obligatorios en Mercados de Seguros de Salud Segmentados," Estudios de Economia, University of Chile, Department of Economics, University of Chile, Department of Economics, vol. 36(2 Year 20), pages 217-241, December.
  2. Böckerman, Petri & Kanninen, Ohto & Suoniemi, Ilpo, 2014. "A Kink that Makes You Sick: The Incentive Effect of Sick Pay on Absence," IZA Discussion Papers 8205, Institute for the Study of Labor (IZA).
  3. Arnold, Daniel & Brändle, Tobias & Goerke, Laszlo, 2013. "Sickness Absence, Works Councils, and Personnel Problems. Evidence from German Individual and Linked Employer-Employee Data," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order, Verein für Socialpolitik / German Economic Association 79906, Verein für Socialpolitik / German Economic Association.
  4. Lechmann, Daniel S. J. & Schnabel, Claus, 2013. "Absence from work of the self-employed: A comparison with paid employees," Discussion Papers, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics 87, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
  5. Nicolas R. Ziebarth & Martin Karlsson, 2009. "A Natural Experiment on Sick Pay Cuts, Sickness Absence, and Labor Costs," SOEPpapers on Multidisciplinary Panel Data Research 244, DIW Berlin, The German Socio-Economic Panel (SOEP).
  6. Ziebarth, Nicolas R., 2013. "Long-term absenteeism and moral hazard—Evidence from a natural experiment," Labour Economics, Elsevier, Elsevier, vol. 24(C), pages 277-292.
  7. Schneider, Julia & Beblo, Miriam, 2010. "Health at work - indicators and determinants : a revised literature and data review for Germany," IAB Discussion Paper, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany] 201017, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  8. Johansson, Per & Karimi, Arizo & Nilsson, J Peter, 2014. "Gender differences in shirking: monitoring or social preferences? Evidence from a field experiment," Working Paper Series, Center for Labor Studies, Uppsala University, Department of Economics 2014:2, Uppsala University, Department of Economics.
  9. Nicolas Ziebarth, 2014. "Assessing the effectiveness of health care cost containment measures: evidence from the market for rehabilitation care," International Journal of Health Care Finance and Economics, Springer, Springer, vol. 14(1), pages 41-67, March.
  10. René Böheim & Thomas Leoni, 2014. "Firms' Sickness Costs and Workers' Sickness Absences," NBER Working Papers 20305, National Bureau of Economic Research, Inc.

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