Incentive and spill-over effects of supplementary sickness compensation

Patrik Hesselius and Malin Persson ()
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Malin Persson: Department of Economics, Uppsala University, Postal: Box 513, SE-751 20 Uppsala, Sweden

No 2007:16, Working Paper Series from IFAU - Institute for Evaluation of Labour Market and Education Policy

Abstract: In 1998 the Swedish national sickness insurance policy changed to allow additional compensation from e.g. collective agreements after the 90th day of absence without a reduction of the public sickness benefit. We estimate the effects of this policy change on the duration of sickness absence for employees in the municipal sector. After the change in policy, this group received 10 percentage points additional compensation during day 91 to 360 in a sick leave. The results indicate that durations of at least 91 days increased by 4.7 days on average. As a consequence, the cost for the national sickness insurance increased by 3.0 percent. For the supplementary insurance to cover its total cost, insurance premiums should be increased by 22 percent.

Keywords: Social insurance; sickness absence; collective agreements (search for similar items in EconPapers)
JEL-codes: H51 H55 I38 J22 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2007-06-19
New Economics Papers: this item is included in nep-hea and nep-ias
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Citations: View citations in EconPapers (6)

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