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The Effect of an Increase in Worker's Compensation Benefits on the Duration and Frequency of Benefit Receipt

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  • Frank Neuhauser

    (Survey Research Center, University of California, Berkeley)

  • Steven Raphael

    (Goldman School of Public Policy, University of California, Berkeley)

Abstract

We present quasi-experimental estimates of the effect of changes in workers' compensation benefits on benefit duration and application frequency, using administrative data for California. Our design exploits two increases in temporary disability benefits occurring during the mid-1990s. We find consistent increases in the duration among injured workers whose benefits were affected by the schedule changes, and some evidence indicating that the likelihood of filing for benefits conditional on being injured is responsive to benefit levels. Finally, we evaluate whether the frequency effect on applying for indemnity benefits introduces a sample selection bias into standard quasi-experimental estimates of duration benefit elasticities. 2004 President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Suggested Citation

  • Frank Neuhauser & Steven Raphael, 2004. "The Effect of an Increase in Worker's Compensation Benefits on the Duration and Frequency of Benefit Receipt," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 288-302, February.
  • Handle: RePEc:tpr:restat:v:86:y:2004:i:1:p:288-302
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    Citations

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    Cited by:

    1. Keith Bender & Colin Green & John Heywood, 2012. "Piece rates and workplace injury: Does survey evidence support Adam Smith?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 25(2), pages 569-590, January.
    2. McInerney, Melissa, 2010. "Privatizing public services and strategic behavior: The impact of incentives to reduce workers' compensation claim duration," Journal of Public Economics, Elsevier, vol. 94(9-10), pages 777-789, October.
    3. Puhani, Patrick A. & Sonderhof, Katja, 2010. "The effects of a sick pay reform on absence and on health-related outcomes," Journal of Health Economics, Elsevier, vol. 29(2), pages 285-302, March.
    4. Dillender, Marcus, 2015. "The effect of health insurance on workers’ compensation filing: Evidence from the affordable care act's age-based threshold for dependent coverage," Journal of Health Economics, Elsevier, vol. 43(C), pages 204-228.
    5. Kelly D. Edmiston, 2006. "Workers' Compensation and State Employment Growth," Journal of Regional Science, Wiley Blackwell, vol. 46(1), pages 121-145.
    6. Ziebarth, Nicolas R., 2013. "Long-term absenteeism and moral hazard—Evidence from a natural experiment," Labour Economics, Elsevier, vol. 24(C), pages 277-292.
    7. repec:eee:irlaec:v:52:y:2017:i:c:p:58-73 is not listed on IDEAS
    8. Darius N Lakdawalla & Robert T Reville & Seth A Seabury, 2007. "How Does Health Insurance Affect Workers' Compensation Filing?," Economic Inquiry, Western Economic Association International, vol. 45(2), pages 286-303, April.
    9. Hyatt Henry R, 2011. "The Labor Supply Consequences of Employment-Limiting Social Insurance Benefits: New Tests for Income Effects," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 11(1), pages 1-31, May.

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