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Insured by the partner?

  • Olsson, Martin


    (Stockholm University, Department of Economics)

  • Skogman Thoursie, Peter


    (IFAU - Institute for Labour Market Policy Evaluation)

This paper investigates whether the partner’s social insurance coverage affects spousal labor supply. Using a reform which increased the sickness insurance coverage for non-government workers, the spousal elasticity of sick days with respect to the partner’s benefit is estimated to 0.4. Additional analysis indicates that the partner’s insurance coverage is partly affecting spousal labor supply through an insurance effect and the overall effect is particularly large among low income families. Joint leisure is not found to have an effect on the overall effect. We conclude that spouses pool their supply of la-bor. Thus if policy evaluations ignore spousal interactions they will underestimate the effect.

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Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2010:3.

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Length: 24 pages
Date of creation: 05 Mar 2010
Date of revision:
Publication status: Published as Olsson, Martin and Peter Skogman Thoursie, 'Sickness insurance and spousal labour supply' in Labour Economics, 2015, pages 41-54.
Handle: RePEc:hhs:ifauwp:2010_003
Contact details of provider: Postal: IFAU, P O Box 513, SE-751 20 Uppsala, Sweden
Phone: (+46) 18 - 471 70 70
Fax: (+46) 18 - 471 70 71
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  1. Johansson, Per & Palme, Marten, 1996. "Do economic incentives affect work absence? Empirical evidence using Swedish micro data," Journal of Public Economics, Elsevier, vol. 59(2), pages 195-218, February.
  2. Cullen, Julie Berry & Gruber, Jonathan, 2000. "Does Unemployment Insurance Crowd Out Spousal Labor Supply?," Journal of Labor Economics, University of Chicago Press, vol. 18(3), pages 546-72, July.
  3. Michael Baker, . "The Retirement Behavior of Married Couples: Evidence From The Spouse’s Allowance," Department of Economics 99-03, California Davis - Department of Economics.
  4. Susan Athey & Guido W. Imbens, 2006. "Identification and Inference in Nonlinear Difference-in-Differences Models," Econometrica, Econometric Society, vol. 74(2), pages 431-497, 03.
  5. Oriana Bandiera & Iwan Barankay & Imran Rasul, 2005. "Social Preferences and the Response to Incentives: Evidence from Personnel Data," The Quarterly Journal of Economics, Oxford University Press, vol. 120(3), pages 917-962.
  6. Magnus Henrekson & Mats Persson, 2004. "The Effects on Sick Leave of Changes in the Sickness Insurance System," Journal of Labor Economics, University of Chicago Press, vol. 22(1), pages 87-114, January.
  7. Kanika Kapur & Jeannette Rogowski, 2007. "The Role of Health Insurance in Joint Retirement among Married Couples," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 60(3), pages 397-407, April.
  8. Edin, P.-A. & Fredriksson, P., 2000. "LINDA - Longitudinal INdividual DAta for Sweden," Papers 2000-19, Uppsala - Working Paper Series.
  9. repec:tpr:qjecon:v:120:y:2005:i:3:p:917-962 is not listed on IDEAS
  10. Alan B. Krueger & Bruce D. Meyer, 2002. "Labor Supply Effects of Social Insurance," NBER Working Papers 9014, National Bureau of Economic Research, Inc.
  11. Moulton, Brent R., 1986. "Random group effects and the precision of regression estimates," Journal of Econometrics, Elsevier, vol. 32(3), pages 385-397, August.
  12. Alan L. Gustman & Thomas L. Steinmeier, 2004. "Personal Accounts and Family Retirement," NBER Working Papers 10305, National Bureau of Economic Research, Inc.
  13. Oriana Bandiera & Iwan Barankay & Imran Rasul, 2005. "Social Preferences and the Response to Incentives: Evidence from Personnel Data," The Quarterly Journal of Economics, Oxford University Press, vol. 120(3), pages 917-962.
  14. Johansson, Per & Palme, Marten, 2005. "Moral hazard and sickness insurance," Journal of Public Economics, Elsevier, vol. 89(9-10), pages 1879-1890, September.
  15. Ashenfelter, Orley, 1980. "Unemployment as Disequilibrium in a Model of Aggregate Labor Supply," Econometrica, Econometric Society, vol. 48(3), pages 547-64, April.
  16. David H. Autor & Mark G. Duggan, 2007. "Distinguishing Income from Substitution Effects in Disability Insurance," American Economic Review, American Economic Association, vol. 97(2), pages 119-124, May.
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