TY - JOUR

T1 - The effects of a sick pay reform on absence and on health-related outcomes

AU - Puhani, Patrick A.

AU - Sonderhof, Katja

N1 - Funding Information: This research was supported by the German Research Foundation (DFG) within the project ‘Labor Market Effects of Social Policy’ which is part of the research initiative ‘Flexibility in Heterogeneous Labor Markets’. We are grateful to Christian Dustmann, John Heywood, Jeff Smith, Fan Wu, two anonymous referees and seminar participants at Cornell University; EEA (Barcelona); ERMES, University of Paris II; Hebrew University; Tel Aviv University; University of Hannover; University of Magdeburg; University of Michigan; University of Wisconsin-Milwaukee; and ZEW, Mannheim, for helpful comments. All remaining errors are our own.

PY - 2010/3

Y1 - 2010/3

N2 - We evaluate the effects of a reduction in sick pay from 100 to 80% of the wage. Unlike previous literature, apart from absence from work, we also consider effects on doctor/hospital visits and subjective health indicators. We also add to the literature by estimating both switch-on and switch-off effects, because the reform was repealed 2 years later. We find a 2-day reduction in the number of days of absence. Quantile regression reveals higher point estimates (both in absolute and relative terms) at higher quantiles, meaning that the reform predominantly reduced long durations of absence. In terms of health, the reform reduced the average number of days spent in hospital by almost half a day, but we cannot find robust evidence for negative effects on health outcomes or perceived liquidity constraints.

AB - We evaluate the effects of a reduction in sick pay from 100 to 80% of the wage. Unlike previous literature, apart from absence from work, we also consider effects on doctor/hospital visits and subjective health indicators. We also add to the literature by estimating both switch-on and switch-off effects, because the reform was repealed 2 years later. We find a 2-day reduction in the number of days of absence. Quantile regression reveals higher point estimates (both in absolute and relative terms) at higher quantiles, meaning that the reform predominantly reduced long durations of absence. In terms of health, the reform reduced the average number of days spent in hospital by almost half a day, but we cannot find robust evidence for negative effects on health outcomes or perceived liquidity constraints.

KW - Absenteeism

KW - Difference-in-differences

KW - Hospitalization

KW - Sickness pay

KW - Subjective health

UR - http://www.scopus.com/inward/record.url?scp=77950628738&partnerID=8YFLogxK

U2 - 10.1016/j.jhealeco.2010.01.003

DO - 10.1016/j.jhealeco.2010.01.003

M3 - Article

C2 - 20153537

AN - SCOPUS:77950628738

VL - 29

SP - 285

EP - 302

JO - Journal of health economics

JF - Journal of health economics

SN - 0167-6296

IS - 2

ER -