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The Effects on Sick Leave of Changes in the Sickness Insurance System

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  • Henrekson, Magnus

    ()
    (Stockholm School of Economics)

  • Persson, Mats

    ()
    (Institute for International Economic Studies, Stockholm University)

Abstract

In order to get a more complete picture of how labor supply is affected by economic incentives, the effects on absenteeism and not just on contracted hours should be taken into account. In particular, absenteeism due to sick leave can be considerable. In this paper we examine whether the level of sick leave compensation affects sick leave behavior. Using time-series data for Sweden spanning a long period (1955-99) with numerous changes of the compensation level, we generally find strong effects of the expected sign. Reforms implying more generous compensation for sick leave tend to be associated with permanent increases in total sick leave per person employed and vice versa. These findings are reinforced in a panel study covering the 1983-91 period.

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Bibliographic Info

Paper provided by Stockholm University, Institute for International Economic Studies in its series Seminar Papers with number 697.

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Length: 35 pages
Date of creation: 25 Sep 2001
Date of revision:
Publication status: Published as Henrekson, Magnus and Mats Persson, 'The Effects on Sick Leave of Changes in the Sickness Insurance System' in Labor Economics, 2004, pages 87-113.
Handle: RePEc:hhs:iiessp:0697

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Postal: Institute for International Economic Studies, Stockholm University, S-106 91 Stockholm, Sweden
Phone: +46-8-162000
Fax: +46-8-161443
Web page: http://www.iies.su.se/
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Related research

Keywords: Absenteeism; Labor supply; Sick leave; Sickness insurance; Social security;

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