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Is Workers' Compensation Disguised Unemployment Insurance?

Author

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  • Bernard Fortin
  • Paul Lanoie
  • Christine Laporte

Abstract

This paper examines how yhe Workers' Compensation (WC) and the Unemployment Insurance (UI) programs interact to influence the duration of claims due to workplace accidents. We use longitudinal WC administrative micro-data on more than 30,000 workers in the Quebec construction industry for the period 1976-1986. Our results show that a reduction in the UI wage replacement ratio is associated with an increase in the duration of claims due to serve accidents that are difficult to diagnose (this category includes severe back-related problems). Also, an increase in the WC replacement ratio leads to an increase in the average duration of claims due to minor accidents that are difficult to diagnose (this category includes minor low-back injuries). Moreover, there seems to be an important seasonal effect in the duration of claims; i.e., the average duration of spells on WC is estimated to be 21.2% higher when an accident occurs in December rather than in July. Ce texte examine comment l'assurance contre les lésions professionnelles (ALP) et l'assurance-chômage (AC) interagissent pour influencer la durée des réclamations pour lésions professionnelles. Nous utilisons des micro-données administratives longitudinales couvrant plus de 30 000 travailleurs du secteur de la construction pour la période 1976-1986. Nos résultats montrent qu'une réduction du taux de remplacement salarial de l'assurance-chômage est associée à une augmentation de la durée des accidents majeurs difficiles à diagnostiquer (cette catégorie inclut les maux de dos majeurs). De plus, un accroissement du taux de remplacement salarial de l'ALP entraîne un accroissement de la durée des accidents mineurs difficiles à diagnostiquer (cette catégorie inclut les lombalgies). Enfin, il semble y avoir un effet saisonnier lié à la durée des périodes d'indemnisation est plus élevée de 21.2% lorsqu'un accident survient en1101 plutôt qu'en0701.

Suggested Citation

  • Bernard Fortin & Paul Lanoie & Christine Laporte, 1995. "Is Workers' Compensation Disguised Unemployment Insurance?," CIRANO Working Papers 95s-48, CIRANO.
  • Handle: RePEc:cir:cirwor:95s-48
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    File URL: http://www.cirano.qc.ca/files/publications/95s-48.pdf
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    References listed on IDEAS

    as
    1. Dionne, Georges & St-Michel, Pierre, 1991. "Workers' Compensation and Moral Hazard," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 236-244, May.
    2. Bernard Fortin & Paul Lanoie & Christine Laporte, 1996. "Unemployment Insurance and the Duration of Workplace Accidents," Canadian Journal of Economics, Canadian Economics Association, vol. 29(s1), pages 17-24, April.
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    Cited by:

    1. Fortin, B. & Lanoie, P., 1998. "Effects of Workers' Compensation : A Survey," Papers 9816, Laval - Recherche en Politique Economique.
    2. Dionne, Georges, 1998. "La mesure empirique des problèmes d’information," L'Actualité Economique, Société Canadienne de Science Economique, vol. 74(4), pages 585-606, décembre.
    3. Pierre André Chiappori & Bernard Salanié, 2002. "Testing Contract Theory: A Survey of Some Recent Work," CESifo Working Paper Series 738, CESifo Group Munich.
    4. Paul Lanoie & Sophie Tavenas, 1995. "Costs and Benefits of Preventing Workplace Accidents: The Case of Participatory Ergonomics," CIRANO Working Papers 95s-38, CIRANO.

    More about this item

    Keywords

    duration; worplace accidents; construction; worker's compensation; unemployment insurance; hazard; durée; accidents du travail; lésions professionnelles; assurance-chômage; construction; hazard;

    JEL classification:

    • J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings

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