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Coming to work while sick: An economic theory of presenteeism with an application to German data

Author

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  • Hirsch, Boris
  • Lechmann, Daniel
  • Schnabel, Claus

Abstract

Presenteeism, i.e. attending work while sick, is widespread and associated with significant costs. Still, economic analyses of this phenomenon are rare. In a theoretical model, we show that presenteeism arises due to differences between workers in the disutility from workplace attendance. As these differences are unobservable by employers, they set wages that incentivise sick workers to attend work. Using a large representative German data set, we test several hypotheses derived from our model. In line with our predictions, we find that stressful working conditions and bad health status are positively related to presenteeism. Better dismissal protection, captured by higher tenure, is associated with slightly fewer presenteeism days, whereas the role of productivity and skills is inconclusive.

Suggested Citation

  • Hirsch, Boris & Lechmann, Daniel & Schnabel, Claus, 2016. "Coming to work while sick: An economic theory of presenteeism with an application to German data," Annual Conference 2016 (Augsburg): Demographic Change 145478, Verein für Socialpolitik / German Economic Association.
  • Handle: RePEc:zbw:vfsc16:145478
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    References listed on IDEAS

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    1. Pichler, Stefan & Ziebarth, Nicolas R., 2015. "The Pros and Cons of Sick Pay Schemes: A Method to Test for Contagious Presenteeism and Shirking Behavior," IZA Discussion Papers 8850, Institute of Labor Economics (IZA).
    2. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588.
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    5. Barmby, Tim & Sessions, John G & Treble, John G, 1994. " Absenteeism, Efficiency Wages and Shirking," Scandinavian Journal of Economics, Wiley Blackwell, vol. 96(4), pages 561-566.
    6. Pedersen, Kjeld Møller & Skagen, Kristian, 2014. "The Economics of Presenteeism: A discrete choice & count model framework," DaCHE discussion papers 2014:2, University of Southern Denmark, Dache - Danish Centre for Health Economics.
    7. Joshua D. Angrist & Jörn-Steffen Pischke, 2009. "Mostly Harmless Econometrics: An Empiricist's Companion," Economics Books, Princeton University Press, edition 1, number 8769.
    8. Puhani, Patrick A. & Sonderhof, Katja, 2010. "The effects of a sick pay reform on absence and on health-related outcomes," Journal of Health Economics, Elsevier, vol. 29(2), pages 285-302, March.
    9. Hansen, Claus D. & Andersen, Johan H., 2008. "Going ill to work - What personal circumstances, attitudes and work-related factors are associated with sickness presenteeism?," Social Science & Medicine, Elsevier, vol. 67(6), pages 956-964, September.
    10. Daniel Arnold, 2016. "Determinants of the Annual Duration of Sickness Presenteeism: Empirical Evidence from European Data," LABOUR, CEIS, vol. 30(2), pages 198-212, June.
    11. Monojit Chatterji & Colin J. Tilley, 2002. "Sickness, absenteeism, presenteeism, and sick pay," Oxford Economic Papers, Oxford University Press, vol. 54(4), pages 669-687, October.
    12. Shapiro, Carl & Stiglitz, Joseph E, 1984. "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, American Economic Association, vol. 74(3), pages 433-444, June.
    13. S Brown & J G Sessions, 2004. "Absenteeism, Presenteeism, and Shirking," Economic Issues Journal Articles, Economic Issues, vol. 9(1), pages 15-23, March.
    14. Daniel Arnold & Marco de Pinto, 2015. "How are Work-related Characteristics Linked to Sickness Absence and Presenteeism? - Theory and Data -," IAAEU Discussion Papers 201511, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
    15. Treble,John & Barmby,Tim, 2011. "Worker Absenteeism and Sick Pay," Cambridge Books, Cambridge University Press, number 9780521806954, December.
    16. Weiss, Andrew, 1985. "Absenteeism and wages," Economics Letters, Elsevier, vol. 19(3), pages 277-279.
    17. Barmby, Tim & Larguem, Makram, 2009. "Coughs and sneezes spread diseases: An empirical study of absenteeism and infectious illness," Journal of Health Economics, Elsevier, vol. 28(5), pages 1012-1017, September.
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    1. repec:eee:labeco:v:46:y:2017:i:c:p:150-165 is not listed on IDEAS
    2. Pichler, Stefan & Ziebarth, Nicolas R., 2017. "The pros and cons of sick pay schemes: Testing for contagious presenteeism and noncontagious absenteeism behavior," Journal of Public Economics, Elsevier, vol. 156(C), pages 14-33.
    3. Stefan Pichler & Nicolas R. Ziebarth, 2015. "The Pros and Cons of Sick Pay Schemes: Testing for Contagious Presenteeism and Shirking Behavior," Discussion Papers of DIW Berlin 1509, DIW Berlin, German Institute for Economic Research.
    4. Bubonya, Melisa & Cobb-Clark, Deborah A. & Wooden, Mark, 2017. "Mental health and productivity at work: Does what you do matter?," Labour Economics, Elsevier, vol. 46(C), pages 150-165.
    5. Daniel Arnold & Marco de Pinto, 2015. "How are Work-related Characteristics Linked to Sickness Absence and Presenteeism? - Theory and Data -," IAAEU Discussion Papers 201511, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
    6. repec:spr:eujhec:v:19:y:2018:i:8:d:10.1007_s10198-018-0962-6 is not listed on IDEAS
    7. repec:eee:pubeco:v:171:y:2019:i:c:p:86-104 is not listed on IDEAS

    More about this item

    JEL classification:

    • I19 - Health, Education, and Welfare - - Health - - - Other
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J29 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Other

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