Labor Market Implications of Rising Costs of Employer-Provided Health Insurance
Variation in income tax policies and health insurance costs are shown to be theoretically appropriate instruments to identify endogenous firm wage and benefit offers in a labor supply model. Empirical results show that firms are more likely to provide health insurance benefits in states with high marginal income tax rates and low hospitalization costs. The model implies that over the 1983-1995 period, large increases in health insurance costs and reductions in marginal income tax rates lowered the probability of receiving health insurance benefits from employers by 10 percentage points. This decrease in benefits lowered hours of labor supply by 4-7%.
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- David M. Cutler & Brigitte C. Madrian, 1996.
"Labor Market Responses to Rising Health Insurance Costs: Evidence on Hours Worked,"
NBER Working Papers
5525, National Bureau of Economic Research, Inc.
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- Currie, Janet & Madrian, Brigitte C., 1999.
"Health, health insurance and the labor market,"
Handbook of Labor Economics,
in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 50, pages 3309-3416
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IFS Working Papers
W98/18, Institute for Fiscal Studies.
- Janet Currie & Aaron Yelowitz, 1999.
"Health Insurance and Less Skilled Workers,"
NBER Working Papers
7291, National Bureau of Economic Research, Inc.
- Mark C. Berger & Dan A. Black & Frank A. Scott, 1998. "How Well Do We Measure Employer-Provided Health Insurance Coverage?," Contemporary Economic Policy, Western Economic Association International, vol. 16(3), pages 356-367, 07.
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