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Incentive Effects of Workers' Compensation Insurance

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Author Info
Alan B. Krueger

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Abstract

This paper uses Currenc Populacion Survey daca on a large sample of workers to escimace the decerminancs of parcicipacion in scace workers' compensacion programs in che United Staces. The principal finding is Chat higher workers' compensation benefits are associaced with greater parcicipacion in the workers' compensation program, after accounting for worker characceriscics, state fixed effects, and other aspects of the workers' compensation law. Moreover, this result holds for both manufacturing and nonmanufacturing workers. Workers' compensacion benefits, however, have an insignificanc effecc on program parcicipation for the sample of women. Overall, a 10% increase in benefits is associaced with a 6.7% increase in program participacion. In addicion, the results show that the waiting period that is required before benefit paymencs begin has a substantial negative effect on parcicipacion in the workers' compensation program. Finally, the parameters of the cross-seccional model are used to simulate the aggregate workers' compensation incidence rate from 1969 to 1987. The growth in workers' compensation claims in the 1970s appears to correspond reasonably well co the growth in real benefits that occurred during this time period.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 3089.

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Date of creation: Nov 1990
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Publication status: published as Journal of Public Economics, Vol. 41, No. 1, pp. 73-99, (1990).
Handle: RePEc:nbr:nberwo:3089

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. John W. Ruser, 1985. "Workers' Compensation Insurance, Experience-Rating, and Occupational Injuries," RAND Journal of Economics, The RAND Corporation, vol. 16(4), pages 487-503, Winter. [Downloadable!] (restricted)
  2. Bartel, Ann P & Thomas, Lacy Glenn, 1985. "Direct and Indirect Effects of Regulation: A New Look at OSHA's Impact," Journal of Law & Economics, University of Chicago Press, vol. 28(1), pages 1-25, April.
  3. Viscusi, W. Kip, 1980. "Imperfect job risk information and optimal workmen's compensation benefits," Journal of Public Economics, Elsevier, vol. 14(3), pages 319-337, December. [Downloadable!] (restricted)
  4. Carmichael, H Lorne, 1986. "Reputations for Safety: Market Performance and Policy Remedies," Journal of Labor Economics, University of Chicago Press, vol. 4(4), pages 458-72, October. [Downloadable!] (restricted)
  5. Ronald G. Ehrenberg, 1989. "Workers' Compensation, Wages, and the Risk of Injury," NBER Working Papers 1538, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  6. Rea, Samuel A, Jr, 1981. "Workmen's Compensation and Occupational Safety under Imperfect Information," American Economic Review, American Economic Association, vol. 71(1), pages 80-93, March. [Downloadable!] (restricted)
  7. Krueger, Alan B & Burton, John F, Jr, 1990. "The Employers' Costs of Workers' Compensation Insurance: Magnitudes, Determinants, and Public Policy," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 228-40, May. [Downloadable!] (restricted)
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  8. Daniel R. Feenberg & Harvey S. Rosen, 1987. "State Personal Income and Sales Taxes: 1977-1983," NBER Working Papers 1631, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  9. Butler, Richard J & Worrall, John D, 1983. "Workers' Compensation: Benefit and Injury Claims Rates in the Seventies," The Review of Economics and Statistics, MIT Press, vol. 65(4), pages 580-89, November. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Leora Friedberg, 1997. "The Effect of Old Age Assistance on Retirement," University of California at San Diego, Economics Working Paper Series 97-14, Department of Economics, UC San Diego. [Downloadable!]
  2. repec:fth:prinin:261 is not listed on IDEAS
  3. repec:fth:prinin:323 is not listed on IDEAS
  4. Paul Lanoie & David StréLiski, 1995. "L'impact de la réglementation en matière de santé et sécurité du travail sur le risque d'accidents au Québec : de nouveaux résultats," CIRANO Working Papers 95s-30, CIRANO. [Downloadable!]
  5. David Card & Brian P. McCall, 1994. "Is Workers' Compensation Covering Uninsured Medical Costs? Evidence from the 'Monday Effect'," Working Papers 706, Princeton University, Department of Economics, Industrial Relations Section.. [Downloadable!]
    Other versions:
  6. repec:fth:prinin:327 is not listed on IDEAS
  7. Alan Krueger, 1990. "Worker's Compensation Insurance and the Duration of Workplace Injuries," Working Papers 641, Princeton University, Department of Economics, Industrial Relations Section.. [Downloadable!]
    Other versions:
  8. Kelly Edmiston, 2005. "Worker's compensation and state employment growth," Community Affairs Research Working Paper 2005-04, Federal Reserve Bank of Kansas City. [Downloadable!]
    Other versions:
  9. David Card & Brian P. McCall, 2006. "When to Start a Fight and When to Fight Back: Liability Disputes in the Workers' Compensation System," NBER Working Papers 11918, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  10. Sarah Crichton & Steven Stillman & Dean Hyslop, 2005. "Returning to Work from Injury: Longitudinal Evidence on Employment and Earnings," IZA Discussion Papers 1857, Institute for the Study of Labor (IZA). [Downloadable!]
  11. Bruce D. Meyer & W. Kip Viscusi & David L. Durbin, 1990. "Workers' Compensation and Injury Duration: Evidence from a Natural Experiment," NBER Working Papers 3494, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  12. Denis Bolduc & Bernard Fortin & France Labrecque & Paul Lanoie, 1997. "Incentive Effects of Public Insurance Programs on the Occurence and the Composition of Workplace Injuries," CIRANO Working Papers 97s-24, CIRANO. [Downloadable!]
  13. Alan Krueger, 1994. "Observations on Employment-Based Government Mandates, With Particular Reference to Health Insurance," Working Papers 702, Princeton University, Department of Economics, Industrial Relations Section.. [Downloadable!]
  14. Julie Berry Cullen, 1999. "The Impact of Fiscal Incentives on Student Disability Rates," NBER Working Papers 7173, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  15. Jonathan Gruber, 1994. "The Consumption Smoothing Benefits of Unemployment Insurance," NBER Working Papers 4750, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  16. Bernard Fortin & Paul Lanoie, 1998. "Effects of Workers' Compensation: A Survey," CIRANO Working Papers 98s-04, CIRANO. [Downloadable!]
    Other versions:
  17. Leora Friedberg, 1998. "The Effect of Old Age Assistance on Retirement," NBER Working Papers 6548, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  18. Avner Ben-Ner & Yong-Seung Park, . "Duration of Non-Work Spells in the Workers' Compensation Insurance System: Unionized vs. Non-Unionized Workers," Working Papers 1202, Industrial Relations Center, University of Minnesota (Twin Cities Campus). [Downloadable!]
  19. Alan B. Krueger & Bruce D. Meyer, 2002. "Labor Supply Effects of Social Insurance," NBER Working Papers 9014, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
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