Institutional rules, labour demand and retirement through disability programme participation

Tomi Kyyrä and Ossi Korkeamäki

No 16, Working Papers from VATT Institute for Economic Research

Abstract: We use matched employer-employee data from Finland to model transitions out of work into sick leave and disability retirement. To identify the role of institutional factors we exploit reforms that changed medical requirements for disability pension eligibility and experience-rated employer contributions. We find that transitions to sick leave and disability pension benefits are relatively rare in growing establishments, but rather common in establishments with a high degree of excess worker turnover. We also show that transitions to disability retirement depend on the stringency of medical screening and the degree of experience rating applied to the employer.

Keywords: Disability pension, sick leave, experience rating, Labour market, Työmarkkinat, Labor market and policies promoting economic growth, Työmarkkinat ja kasvua tukeva politiikka, J140 - Economics of the Elderly; Economics of the Handicapped, J230 - Employment Determination; Job Creation; Demand for Labor; Self-Employment, J260 - Retirement; Retirement Policies, (search for similar items in EconPapers)
Date: 2010
New Economics Papers: this item is included in nep-age, nep-lab and nep-mic
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https://www.doria.fi/handle/10024/148755

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Journal Article: Institutional rules, labour demand and retirement through disability programme participation (2012)
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