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Firms' Sickness Costs and Workers' Sickness Absences

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  • René Böheim
  • Thomas Leoni

Abstract

In many countries, social security insures firms against their workers' sickness absences. The insurance may create a moral hazard for firms, leading to inefficient monitoring of absences or to an underinvestment in the prevention of absences. We exploit an administrative threshold in the Austrian social security that defined whether a firm had to pay a deductible for its blue-collar workers sicknesses or not. The quasi-experimental situation around the threshold provides causal evidence on the extent of moral hazard induced by the deductible. We apply a regression discontinuity design to estimate the differences in the incidences and durations of sicknesses for firms that faced the deductible and those who did not. We find that the deductible did not lead to different sickness outcomes and conclude that relatively low deductibles have little impact on forms' management of sicknesses.

Suggested Citation

  • René Böheim & Thomas Leoni, 2014. "Firms' Sickness Costs and Workers' Sickness Absences," NBER Working Papers 20305, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:20305
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    1. Firms and sickness absences
      by René Böheim in Econ Tidbits on 2014-07-25 16:50:00

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    Cited by:

    1. Carlo Alberto Biscardo & Alessandro Bucciol & Paolo Pertile, 2015. "Who should monitor job sick leave?," Working Papers 18/2015, University of Verona, Department of Economics.
    2. Alexander Ahammer, 2016. "How Physicians Affect Patients’ Employment Outcomes Through Deciding on Sick Leave Durations," Economics working papers 2016-05, Department of Economics, Johannes Kepler University Linz, Austria.
    3. René Böheim & Thomas Leoni, 2016. "Disability policies: Reform strategies in a comparative perspective," NBER Working Papers 22206, National Bureau of Economic Research, Inc.

    More about this item

    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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