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Social Insurance Networks

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  • Markussen, Simen

    ()
    (Ragnar Frisch Centre for Economic Research)

  • Røed, Knut

    ()
    (Ragnar Frisch Centre for Economic Research)

Abstract

Based on administrative panel data from Norway, we examine how social insurance dependency spreads within neighborhoods, families, ethnic minorities, and among former schoolmates. We use a fixed effects methodology that accounts for endogenous group formation, contextual interactions, and time-constant as well as time-varying confounders. We report evidence that social insurance dependency is contagious. The estimated network effects are both quantitatively and statistically significant, and they rise rapidly with "relational closeness" in a way that establishes endogenous social interaction as a central causal mechanism. Social interactions do not cross ethnic borders.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6446.

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Length: 43 pages
Date of creation: Mar 2012
Date of revision:
Handle: RePEc:iza:izadps:dp6446

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Keywords: work norms; social multiplier; social interaction; peer effects;

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References

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  1. Beatrix Brügger & Rafael Lalive & Andreas Steinhauer & Josef Zweimüller, 2011. "The demand for social insurance: does culture matter?," ECON - Working Papers 041, Department of Economics - University of Zurich.
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  4. Edward L. Glaeser & Bruce I. Sacerdote & Jose A. Scheinkman, 2002. "The Social Multiplier," Harvard Institute of Economic Research Working Papers 1968, Harvard - Institute of Economic Research.
  5. Gaure, Simen, 2013. "OLS with multiple high dimensional category variables," Computational Statistics & Data Analysis, Elsevier, vol. 66(C), pages 8-18.
  6. Mari Rege & Kjetil Telle & Mark Votruba, 2012. "Social Interaction Effects in Disability Pension Participation: Evidence from Plant Downsizing," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(4), pages 1208-1239, December.
  7. Yannis M. Ioannides & Linda Datcher Loury, 2004. "Job Information Networks, Neighborhood Effects, and Inequality," Journal of Economic Literature, American Economic Association, vol. 42(4), pages 1056-1093, December.
  8. Cattaneo, Alejandra & Lalive, Rafael, 2006. "Social Interactions and Schooling Decisions," CEPR Discussion Papers 5816, C.E.P.R. Discussion Papers.
  9. Bratsberg, Bernt & Raaum, Oddbjørn & Røed, Knut, 2007. "When Minority Labor Migrants Meet the Welfare State," IZA Discussion Papers 2872, Institute for the Study of Labor (IZA).
  10. Andrea Ichino & Giovanni Maggi, 1999. "Work Environment and Individual Background: Explaining Regional Shirking Differentials in a Large Italian Firm," NBER Working Papers 7415, National Bureau of Economic Research, Inc.
  11. Manski, Charles F, 1993. "Identification of Endogenous Social Effects: The Reflection Problem," Review of Economic Studies, Wiley Blackwell, vol. 60(3), pages 531-42, July.
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  13. Anna Aizer & Janet Currie, 2002. "Networks or Neighborhoods? Correlations in the Use of Publicly-Funded Maternity Care in California," NBER Working Papers 9209, National Bureau of Economic Research, Inc.
  14. Assar Lindbeck & Sten Nyberg & Jšrgen W. Weibull, 1999. "Social Norms And Economic Incentives In The Welfare State," The Quarterly Journal of Economics, MIT Press, vol. 114(1), pages 1-35, February.
  15. Bratsberg, Bernt & Fevang, Elisabeth & Røed, Knut, 2010. "Disability in the Welfare State: An Unemployment Problem in Disguise?," IZA Discussion Papers 4897, Institute for the Study of Labor (IZA).
  16. Markussen, Simen, 2009. "Closing the Gates? Evidence from a Natural Experiment on Physicians' Sickness Certification," Memorandum 19/2009, Oslo University, Department of Economics.
  17. Erik Biørn & Simen Gaure & Simen Markussen & Knut Røed, 2013. "The rise in absenteeism: disentangling the impacts of cohort, age and time," Journal of Population Economics, Springer, vol. 26(4), pages 1585-1608, October.
  18. Mari Rege & Kjetil Telle & Mark Votruba, 2009. "The Effect of Plant Downsizing on Disability Pension Utilization," Journal of the European Economic Association, MIT Press, vol. 7(4), pages 754-785, 06.
  19. Hesselius, Patrik & Johansson, Per & Nilsson, Peter, 2009. "Sick of your colleagues' absence?," Working Paper Series 2009:2, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  20. Moffitt, Robert, 1983. "An Economic Model of Welfare Stigma," American Economic Review, American Economic Association, vol. 73(5), pages 1023-35, December.
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Cited by:
  1. Rieck, Karsten Marshall Elseth & Vaage, Kjell, 2012. "Social Interactions At The Workplace: Exploring Sickness Absence Behavior," Working Papers in Economics 11/12, University of Bergen, Department of Economics.
  2. Gaure, Simen, 2013. "OLS with multiple high dimensional category variables," Computational Statistics & Data Analysis, Elsevier, vol. 66(C), pages 8-18.

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