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Sick of being unemployed? Interactions between unemployment and sickness insurance in Sweden

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    Abstract

    This paper examines the incentive effects caused by the interactions between unemployment insurance (UI) and sickness insurance (SI), two important components of Sweden’s social insurance system. There are two main topics of interest: how the sickness report rate and the length of the subsequent sick period among the unemployed are affected by (i) the limit of 300 workdays for UI benefits, and (ii) the difference in maximum compensation between UI and SI benefits. Results obtained by duration analysis suggest that sick reports increase as the UI benefit expiration date approaches. There is also evidence of an incentive effect on the sick-report rate because SI offers greater compensation than UI. But neither of these factors seems to have a significant effect on the length of the sick period.

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    Bibliographic Info

    Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2002:6.

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    Length: 34 pages
    Date of creation: 18 Mar 2002
    Date of revision:
    Handle: RePEc:hhs:ifauwp:2002_006

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    Postal: IFAU, P O Box 513, SE-751 20 Uppsala, Sweden
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    Related research

    Keywords: Unemployment insurance; sickness insurance; health; duration analysis; discrete hazard models;

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    1. Carling, K. & Holmlund, B. & Vejsiu, A., 1999. "Do Benefit Cuts Boost Job Findings? Swedish Evidence from the 1990s," Papers 1999:20, Uppsala - Working Paper Series.
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    4. Henrekson, Magnus & Persson, Mats, 2001. "The Effects on Sick Leave of Changes in the Sickness Insurance System," Working Paper Series in Economics and Finance 0444, Stockholm School of Economics, revised 08 Aug 2001.
    5. Carling, Kenneth & Edin, Per-Anders & Harkman, Anders & Holmlund, Bertil, 1996. "Unemployment duration, unemployment benefits, and labor market programs in Sweden," Journal of Public Economics, Elsevier, vol. 59(3), pages 313-334, March.
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    7. Berg, G.J. van den, 1987. "Nonstationarity in job search theory," Research Memorandum 242, Tilburg University, Faculty of Economics and Business Administration.
    8. Stephen Nickell & D. Nicolitsas, 1994. "Wages," LSE Research Online Documents on Economics 51644, London School of Economics and Political Science, LSE Library.
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    13. Johansson, Per & Palme, Marten, 1996. "Do economic incentives affect work absence? Empirical evidence using Swedish micro data," Journal of Public Economics, Elsevier, vol. 59(2), pages 195-218, February.
    14. Alan B. Krueger & Bruce D. Meyer, 2002. "Labor Supply Effects of Social Insurance," NBER Working Papers 9014, National Bureau of Economic Research, Inc.
    15. Currie, Janet & Madrian, Brigitte C., 1999. "Health, health insurance and the labor market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 50, pages 3309-3416 Elsevier.
    16. Broström, Göran & Johansson, Per & Palme, Mårten, 1998. "Assessing the Effect of Economic Incentives on Incidence and Duration of Work Absence," Working Paper Series in Economics and Finance 228, Stockholm School of Economics.
    17. Edin, P.-A. & Fredriksson, P., 2000. "LINDA - Longitudinal INdividual DAta for Sweden," Papers 2000-19, Uppsala - Working Paper Series.
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    19. Andersson, Fredrik & Vejsiu, Altin, 2001. "Determinants of plant closures in Swedish manufacturing," Working Paper Series 2001:6, IFAU - Institute for Evaluation of Labour Market and Education Policy.
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    21. David Edgerton & Curt Wells, 2000. "A Model for the Analysis of Sick Leave in Sweden," Econometric Society World Congress 2000 Contributed Papers 1091, Econometric Society.
    22. van den Berg, Gerard J, 1994. "The Effects of Changes of the Job Offer Arrival Rate on the Duration of Unemployment," Journal of Labor Economics, University of Chicago Press, vol. 12(3), pages 478-98, July.
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    Cited by:
    1. Hallberg, Daniel, 2003. "A Description of Routes out of the Labor Force for Workers in Sweden," Working Paper Series 2003:23, Uppsala University, Department of Economics.
    2. Hesselius, Patrik, 2003. "Does Sick Absence Increase the Risk of Unemployment?," Working Paper Series 2003:15, Uppsala University, Department of Economics.

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