Advanced Search
MyIDEAS: Login

Labor Market Responses to Rising Health Insurance Costs: Evidence on Hours Worked

Contents:

Author Info

  • David M. Cutler
  • Brigitte C. Madrian

Abstract

Increases in the cost of providing health insurance must have some effect on labor markets, either in lower wages, changes in the composition of employment, or both. Despite a presumption that most of this effect will be in the form of lower wages, we document in this paper a significant effect on work hours as well. Using data from the CPS and the SIPP, we show that rising health insurance costs over the 1980s increased the hours worked of those with health insurance by up to 3 percent. We argue that this occurs because health insurance is a fixed cost, and as it becomes more expensive to provide, firms face an incentive to substitute hours per worker for the number of workers employed.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.nber.org/papers/w5525.pdf
Download Restriction: no

Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 5525.

as in new window
Length:
Date of creation: Apr 1996
Date of revision:
Publication status: published as RAND Journal of Economics, Vol. 29 (1998): 509-530.
Handle: RePEc:nbr:nberwo:5525

Note: AG HC PE
Contact details of provider:
Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Phone: 617-868-3900
Email:
Web page: http://www.nber.org
More information through EDIRC

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
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.:
as in new window
  1. Jonathan Gruber & Alan B. Krueger, 1991. "The Incidence of Mandated Employer-Provided Insurance: Lessons from Workers' Compensation Insurance," NBER Chapters, in: Tax Policy and the Economy, Volume 5, pages 111-144 National Bureau of Economic Research, Inc.
  2. Mark Montgomery & James Cosgrove, 1993. "The effect of employee benefits on the demand for part-time workers," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 47(1), pages 87-98, October.
  3. Trejo, Stephen J, 1991. "The Effects of Overtime Pay Regulation on Worker Compensation," American Economic Review, American Economic Association, vol. 81(4), pages 719-40, September.
  4. Montgomery, Mark, 1988. "On the Determinants of Employer Demand for Part-Time Workers," The Review of Economics and Statistics, MIT Press, vol. 70(1), pages 112-17, February.
  5. Gruber, Jonathan, 1994. "The Incidence of Mandated Maternity Benefits," American Economic Review, American Economic Association, vol. 84(3), pages 622-41, June.
  6. David Bradford, 1991. "Tax Policy and the Economy, Volume 5," NBER Books, National Bureau of Economic Research, Inc, number brad91-1.
  7. Summers, Lawrence H, 1989. "Some Simple Economics of Mandated Benefits," American Economic Review, American Economic Association, vol. 79(2), pages 177-83, May.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Stephen DeLoach & Jennifer Platania, 2013. "The Macroeconomic Consequences of Financing Health Insurance," International Advances in Economic Research, Springer, vol. 19(2), pages 107-129, May.
  2. Kanika Kapur & José J Escarce & M Susan Marquis & Kosali I Simon, 2006. "Where Do the Sick Go? Health Insurance and Employment in Small and Large Firms," Working Papers 200613, School Of Economics, University College Dublin.
  3. Jonathan T. Kolstad & Amanda E. Kowalski, 2012. "Mandate-Based Health Reform and the Labor Market: Evidence from the Massachusetts Reform," Cowles Foundation Discussion Papers 1855, Cowles Foundation for Research in Economics, Yale University.
  4. Meyer, Rebecca & Orazem, Peter & Wachenheim, William A., 2002. "Labor Market Implications of Rising Costs of Employer-Provided Health Insurance," Staff General Research Papers 10016, Iowa State University, Department of Economics.
  5. Velamuri, Malathi, 2009. "Taxes, Health Insurance and Women’s Self-Employment," MPRA Paper 15731, University Library of Munich, Germany.
  6. Brigitte Madrian, 2006. "The U.S. Health Care System and Labor Markets," NBER Working Papers 11980, National Bureau of Economic Research, Inc.
  7. Kanika Kapur & Pinar Karaca-Mandic & Susan M Gates & Brent Fulton, 2006. "Do Small Group Health Insurance Regulations Influence Small Business Size?," Working Papers 200622, School Of Economics, University College Dublin.
  8. Barkume, Anthony J., 2007. "Some New Evidence on Overtime Use, Total Job Compensation, and Wage Rates," Working Papers 402, U.S. Bureau of Labor Statistics.
  9. A. M. Wolaver & T. D. McBride & B. L. Wolfe, . "Decreasing Opportunities for Low-Wage Workers: The Role of the Nondiscrimination Law for Employer-Provided Health Insurance," Institute for Research on Poverty Discussion Papers 1124-97, University of Wisconsin Institute for Research on Poverty.
  10. Katherine Baicker & Amitabh Chandra, 2005. "The Consequences of the Growth of Health Insurance Premiums," American Economic Review, American Economic Association, vol. 95(2), pages 214-218, May.
  11. Carrie H. Colla & William H. Dow & Arindrajit Dube, 2011. "The Labor Market Impact of Employer Health Benefit Mandates: Evidence from San Francisco’s Health Care Security Ordinance," NBER Working Papers 17198, National Bureau of Economic Research, Inc.
  12. David J. Vanness, 2003. "A structural econometric model of family valuation and choice of employer-sponsored health insurance in the United States," Health Economics, John Wiley & Sons, Ltd., vol. 12(9), pages 771-790.
  13. Brigitte C. Madrian & Lars John Lefgren, 1999. "A Note on Longitudinally Matching Current Population Survey (CPS) Respondents," NBER Technical Working Papers 0247, National Bureau of Economic Research, Inc.
  14. Laura Bucila, 2008. "Employment-Based Health Insurance and the Minimum Wage," Working Papers 0812, College of the Holy Cross, Department of Economics.
  15. Jennifer Feenstra Schultz & David Doorn, 2009. "Employer Health Benefit Costs and Demand for Part-Time Labor," Working Papers 09-08, Center for Economic Studies, U.S. Census Bureau.
  16. Robert Dixon & John Freebairn, 2007. "Hours of Work: A Demand Perspective," Department of Economics - Working Papers Series 1022, The University of Melbourne.
  17. Sang-Hyop Lee & Gerard Russo & Lawrence H. Nitz & Abdul Jabbar, 2005. "The Effect of Mandatory Employer-Sponsored Insurance (ESI) on Health Insurance Coverage and Labor Force Utilization in Hawaii: Evidence from the Current Population Survey (CPS) 1994-2004," Working Papers 200512, University of Hawaii at Manoa, Department of Economics.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:5525. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.