Social Insurance of Short Spell Sickness

Sjur Flåm

Nordic Journal of Political Economy, 2004, vol. 30, 79-90

Abstract: This paper looks at social insurance of short term absence from work. The chief concern is with efficiency properties of full coverage. That arrangement is reviewed and criticized here in light of received theory. A main point is that positive loading of the premium implies less than full coverage. Concerns with optimal risk sharing also pull in the same direction. Besides, full coverage creates problems with moral hazard. The possibilities to self-insure over time are emphasized.

Keywords: risk sharing; coinsurance; deductible; non-insurable risk; Pareto efficiency; mutual insurance; arbitrage; adverse selection; moral hazard (search for similar items in EconPapers)
JEL-codes: D82 G22 J32 Z13 (search for similar items in EconPapers)
Date: 2004
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Persistent link: https://EconPapers.repec.org/RePEc:noj:journl:v:30:y:2004:p:79-90

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