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Social Insurance Networks

  • Markussen, Simen

    ()

    (Ragnar Frisch Centre for Economic Research)

  • Røed, Knut

    ()

    (Ragnar Frisch Centre for Economic Research)

Based on administrative panel data from Norway, we examine how social insurance dependency spreads within neighborhoods, families, ethnic minorities, and among former schoolmates. We use a fixed effects methodology that accounts for endogenous group formation, contextual interactions, and time-constant as well as time-varying confounders. We report evidence that social insurance dependency is contagious. The estimated network effects are both quantitatively and statistically significant, and they rise rapidly with "relational closeness" in a way that establishes endogenous social interaction as a central causal mechanism. Social interactions do not cross ethnic borders.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6446.

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Length: 43 pages
Date of creation: Mar 2012
Date of revision:
Handle: RePEc:iza:izadps:dp6446
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  1. Grönqvist, Olof Åslund, Per-Anders Edin, Peter Fredriksson and Hans, 2009. "Peers, neighborhoods and immigrant student achievement - evidence from a placement policy," Working Paper Series 2009:17, Uppsala University, Department of Economics.
  2. Hesselius, Patrik & Johansson, Per & Nilsson, Peter, 2009. "Sick of your colleagues' absence?," Working Paper Series 2009:2, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  3. Bernt Bratsberg & Oddbjørn Raaum & Knut Røed, 2010. "When Minority Labor Migrants Meet the Welfare State," Journal of Labor Economics, University of Chicago Press, vol. 28(3), pages 633-676, 07.
  4. Beatrix Brügger & Rafael Lalive & Andreas Steinhauer & Josef Zweimüller, 2011. "The demand for social insurance: does culture matter?," ECON - Working Papers 041, Department of Economics - University of Zurich.
  5. Yannis M. Ioannides & Linda Datcher Loury, 2004. "Job Information Networks, Neighborhood Effects, and Inequality," Journal of Economic Literature, American Economic Association, vol. 42(4), pages 1056-1093, December.
  6. Anna Aizer & Janet Currie, 2002. "Networks or Neighborhoods? Correlations in the Use of Publicly-Funded Maternity Care in California," NBER Working Papers 9209, National Bureau of Economic Research, Inc.
  7. Erik Biørn & Simen Gaure & Simen Markussen & Knut Røed, 2013. "The rise in absenteeism: disentangling the impacts of cohort, age and time," Journal of Population Economics, Springer, vol. 26(4), pages 1585-1608, October.
  8. E. Glaeser & B. Sacerdote & Jose A. Scheinkman, 2003. "The Social Multiplier," Levine's Working Paper Archive 506439000000000130, David K. Levine.
  9. Lindbeck, Assar & Nyberg, Sten & Weibull, Jörgen W., 1997. "Social Norms and Economic Incentives in the Welfare State," Working Paper Series 476, Research Institute of Industrial Economics.
  10. Bratsberg, Bernt & Fevang, Elisabeth & Røed, Knut, 2010. "Disability in the Welfare State: An Unemployment Problem in Disguise?," IZA Discussion Papers 4897, Institute for the Study of Labor (IZA).
  11. Mari Rege & Kjetil Telle & Mark Votruba, 2009. "The Effect of Plant Downsizing on Disability Pension Utilization," Journal of the European Economic Association, MIT Press, vol. 7(4), pages 754-785, 06.
  12. Andrea Ichino & Giovanni Maggi, 2000. "Work Environment And Individual Background: Explaining Regional Shirking Differentials In A Large Italian Firm," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 1057-1090, August.
  13. Lalive, Rafael & Cattaneo, Maria Alejandra, 2006. "Social Interactions and Schooling Decisions," IZA Discussion Papers 2250, Institute for the Study of Labor (IZA).
  14. Bradley, Steve & Green, Colin & Leeves, Gareth, 2007. "Worker absence and shirking: Evidence from matched teacher-school data," Labour Economics, Elsevier, vol. 14(3), pages 319-334, June.
  15. Manski, Charles F, 1993. "Identification of Endogenous Social Effects: The Reflection Problem," Review of Economic Studies, Wiley Blackwell, vol. 60(3), pages 531-42, July.
  16. Markussen, Simen, 2009. "Closing the Gates? Evidence from a Natural Experiment on Physicians' Sickness Certification," Memorandum 19/2009, Oslo University, Department of Economics.
  17. Gaure, Simen, 2013. "OLS with multiple high dimensional category variables," Computational Statistics & Data Analysis, Elsevier, vol. 66(C), pages 8-18.
  18. Moffitt, Robert, 1983. "An Economic Model of Welfare Stigma," American Economic Review, American Economic Association, vol. 73(5), pages 1023-35, December.
  19. Mari Rege & Kjetil Telle & Mark Votruba, 2007. "Social Interaction Effects in Disability Pension Participation. Evidence from Plant Downsizing," Discussion Papers 496, Research Department of Statistics Norway.
  20. Cont, Rama & Löwe, Matthias, 2010. "Social distance, heterogeneity and social interactions," Journal of Mathematical Economics, Elsevier, vol. 46(4), pages 572-590, July.
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