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Social Insurance Networks

Listed author(s):
  • 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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File URL: http://ftp.iza.org/dp6446.pdf
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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
Handle: RePEc:iza:izadps:dp6446
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  10. 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.
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  12. Markussen, Simen, 2009. "Closing the Gates? Evidence from a Natural Experiment on Physicians' Sickness Certification," Memorandum 19/2009, Oslo University, Department of Economics.
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  14. Aizer, Anna & Currie, Janet, 2004. "Networks or neighborhoods? Correlations in the use of publicly-funded maternity care in California," Journal of Public Economics, Elsevier, vol. 88(12), pages 2573-2585, December.
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  18. Olof Åslund & Peter Fredriksson, 2009. "Peer Effects in Welfare Dependence: Quasi-Experimental Evidence," Journal of Human Resources, University of Wisconsin Press, vol. 44(3).
  19. 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).
  20. Cont, Rama & Löwe, Matthias, 2010. "Social distance, heterogeneity and social interactions," Journal of Mathematical Economics, Elsevier, vol. 46(4), pages 572-590, July.
  21. Bratsberg, Bernt & Fevang, Elisabeth & Røed, Knut, 2013. "Job loss and disability insurance," Labour Economics, Elsevier, vol. 24(C), pages 137-150.
  22. Beatrix Eugster & Rafael Lalive & Andreas Steinhauer & Josef Zweimüller, 2011. "The Demand for Social Insurance: Does Culture Matter?," Economic Journal, Royal Economic Society, vol. 121(556), pages 413-448, November.
  23. Olof Åslund & Per-Anders Edin & Peter Fredriksson & Hans Grönqvist, 2011. "Peers, Neighborhoods, and Immigrant Student Achievement: Evidence from a Placement Policy," American Economic Journal: Applied Economics, American Economic Association, vol. 3(2), pages 67-95, April.
  24. 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.
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  26. Gaure, Simen, 2013. "OLS with multiple high dimensional category variables," Computational Statistics & Data Analysis, Elsevier, vol. 66(C), pages 8-18.
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