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The Labor Market Efects of Introducing National Health Insurance: Evidence from Canada

Author

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  • Gruber, J.
  • Hanratty, M.

Abstract

The authors study the employment consequences of national health insurance in Canada, using the fact that national health insurance was introduced on a staggered basis across Canadian provinces. They use monthly data on employment, wages, and hours across eight industries and ten provinces over the 1961-75 period. The authors find that employment rose after the introduction of national health insurance; wages increased as well, while average hours were unchanged. They also find lower rates of employment and wage growth in provinces that financed national health insurance with general revenues rather than lump sum premiums and lower rates of wage growth in provinces with high initial levels of private insurance coverage.
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Suggested Citation

  • Gruber, J. & Hanratty, M., 1994. "The Labor Market Efects of Introducing National Health Insurance: Evidence from Canada," Working papers 94-05, Massachusetts Institute of Technology (MIT), Department of Economics.
    • Handle: RePEc:mit:worpap:94-05
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    References listed on IDEAS

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    1. Lawrence Summers & Jonathan Gruber & Rodrigo Vergara, 1993. "Taxation and the Structure of Labor Markets: The Case of Corporatism," The Quarterly Journal of Economics, Oxford University Press, vol. 108(2), pages 385-411.
    2. Joseph P. Newhouse, 1992. "Medical Care Costs: How Much Welfare Loss?," Journal of Economic Perspectives, American Economic Association, vol. 6(3), pages 3-21, Summer.
    3. Summers, Lawrence H, 1989. "Some Simple Economics of Mandated Benefits," American Economic Review, American Economic Association, vol. 79(2), pages 177-183, May.
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    Citations

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    Cited by:

    1. Leora Friedberg, 1998. "Did Unilateral Divorce Raise Divorce Rates? Evidence from Panel Data," NBER Working Papers 6398, National Bureau of Economic Research, Inc.
    2. Vita, Michael G., 2001. "Regulatory restrictions on selective contracting: an empirical analysis of "any-willing-provider" regulations," Journal of Health Economics, Elsevier, vol. 20(6), pages 955-966, November.
    3. Wagstaff, Adam, 2009. "Social health insurance vs. tax-financed health systems - evidence from the OECD," Policy Research Working Paper Series 4821, The World Bank.
    4. Jonathan Gruber, 1998. "Health Insurance and the Labor Market," NBER Working Papers 6762, National Bureau of Economic Research, Inc.
    5. Alan, Sule & Crossley, Thomas F. & Grootendorst, Paul & Veall, Michael R., 2002. "The effects of drug subsidies on out-of-pocket prescription drug expenditures by seniors: regional evidence from Canada," Journal of Health Economics, Elsevier, vol. 21(5), pages 805-826, September.
    6. Jason Murasko, 2008. "Married Women’s Labor Supply and Spousal Health Insurance Coverage in the United States: Results from Panel Data," Journal of Family and Economic Issues, Springer, vol. 29(3), pages 391-406, September.
    7. Wagstaff, Adam & Moreno-Serra, Rodrigo, 2009. "Europe and central Asia's great post-communist social health insurance experiment: Aggregate impacts on health sector outcomes," Journal of Health Economics, Elsevier, vol. 28(2), pages 322-340, March.
    8. Kamhon Kan & Yen-Ling Lin, 2009. "The labor market effects of national health insurance: evidence from Taiwan," Journal of Population Economics, Springer;European Society for Population Economics, vol. 22(2), pages 311-350, April.
    9. Matthew S. Dey & Christopher J. Flinn, 2005. "An Equilibrium Model of Health Insurance Provision and Wage Determination," Econometrica, Econometric Society, vol. 73(2), pages 571-627, March.
    10. Haizhen Lin, 2010. "Do Minimum Quality Standards Improve Quality? A Case Study of the Nursing Home Industry," Working Papers 2010-01, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy.
    11. Jonathan Gruber, 1999. "Social Security and Retirement in Canada," NBER Chapters,in: Social Security and Retirement around the World, pages 73-99 National Bureau of Economic Research, Inc.
    12. World Bank, 2007. "Healthy Development : The World Bank Strategy for Health, Nutrition, and Population Results," World Bank Publications, The World Bank, number 6843.
    13. repec:eee:labchp:v:3:y:1999:i:pc:p:3309-3416 is not listed on IDEAS
    14. Barkowski, Scott, 2015. "Does Defensive Medicine Reduce Health Care Spending?," MPRA Paper 64318, University Library of Munich, Germany.
    15. Husain, Muhammad Jami, 2010. "Contribution of health to economic development: A survey and overview," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 4, pages 1-52.
    16. Steven F. Lehrer & Nuno Sousa Pereira, 2008. "Worker Sorting, Health Insurance and Wages: Further Evidence from Displaced Workers in the United States," CEF.UP Working Papers 0804, Universidade do Porto, Faculdade de Economia do Porto.
    17. Marcelo Bérgolo & Guillermo Cruces, 2011. "Labor Informality and the Incentive Effects of Social Security: Evidence from a Health Reform in Uruguay," IDB Publications (Working Papers) 3829, Inter-American Development Bank.

    More about this item

    Keywords

    health policy ; labour market;

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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