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Mandated Sick Pay: Coverage, Utilization, and Welfare Effects

Johanna Maclean, Stefan Pichler () and Nicolas Ziebarth ()

No 26832, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper evaluates the labor market effects of sick pay mandates in the United States. Using the National Compensation Survey and difference-in-differences models, we estimate their impact on coverage rates, sick leave use, labor costs, and non-mandated fringe benefits. Sick pay mandates increase coverage significantly by 13 percentage points from a baseline level of 66%. Newly covered employees take two additional sick days per year. We find little evidence that mandating sick pay crowds-out other non-mandated fringe benefits. We then develop a model of optimal sick pay provision along with a welfare analysis. Mandating sick pay likely increases welfare.

JEL-codes: I12 I13 I18 J22 J28 J32 (search for similar items in EconPapers)
Date: 2020-03
New Economics Papers: this item is included in nep-hea, nep-hrm and nep-lma
Note: AG HC HE LS PE
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