IDEAS home Printed from https://ideas.repec.org/a/eee/jhecon/v61y2018icp178-192.html
   My bibliography  Save this article

Does experience rating reduce sickness and disability claims? Evidence from policy kinks

Author

Listed:
  • Kyyrä, Tomi
  • Paukkeri, Tuuli

Abstract

We study whether the experience rating of employers’ disability insurance premiums affects the inflow to disability benefits in Finland. To identify the causal effect of experience rating, we exploit kinks in the rule that specifies the degree of experience rating as a function of firm size. Using comprehensive matched employer–employee panel data, we estimate the effects of experience rating on the inflow to sickness and disability benefits. We find that experience rating has little or no effect on either of these outcomes.

Suggested Citation

  • Kyyrä, Tomi & Paukkeri, Tuuli, 2018. "Does experience rating reduce sickness and disability claims? Evidence from policy kinks," Journal of Health Economics, Elsevier, vol. 61(C), pages 178-192.
    • Handle: RePEc:eee:jhecon:v:61:y:2018:i:c:p:178-192
    DOI: 10.1016/j.jhealeco.2018.07.007
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0167629618302054
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jhealeco.2018.07.007?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Petri Böckerman & Ohto Kanninen & Ilpo Suoniemi, 2018. "A kink that makes you sick: The effect of sick pay on absence," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 33(4), pages 568-579, June.
    2. David Card & David S. Lee & Zhuan Pei & Andrea Weber, 2015. "Inference on Causal Effects in a Generalized Regression Kink Design," Econometrica, Econometric Society, vol. 83, pages 2453-2483, November.
    3. John W. Ruser, 1985. "Workers' Compensation Insurance, Experience-Rating, and Occupational Injuries," RAND Journal of Economics, The RAND Corporation, vol. 16(4), pages 487-503, Winter.
    4. Helena Skyt Nielsen & Torben Sørensen & Christopher Taber, 2010. "Estimating the Effect of Student Aid on College Enrollment: Evidence from a Government Grant Policy Reform," NBER Chapters, in: Income Taxation, Trans-Atlantic Public Economics Seminar (TAPES), pages 185-215, National Bureau of Economic Research, Inc.
    5. Michihito Ando, 2017. "How much should we trust regression-kink-design estimates?," Empirical Economics, Springer, vol. 53(3), pages 1287-1322, November.
    6. Tomi Kyyrä & Ralf A. Wilke, 2007. "Reduction in the Long-Term Unemployment of the Elderly: A Success Story from Finland," Journal of the European Economic Association, MIT Press, vol. 5(1), pages 154-182, March.
    7. Dahlberg, Matz & Mörk, Eva & Rattsø, Jørn & Ågren, Hanna, 2008. "Using a discontinuous grant rule to identify the effect of grants on local taxes and spending," Journal of Public Economics, Elsevier, vol. 92(12), pages 2320-2335, December.
    8. Jan-Maarten van Sonsbeek & Raymond H. J. M. Gradus, 2013. "Estimating the effects of recent disability reforms in the Netherlands," Oxford Economic Papers, Oxford University Press, vol. 65(4), pages 832-855, October.
    9. Rothstein, Jesse & Rouse, Cecilia Elena, 2011. "Constrained after college: Student loans and early-career occupational choices," Journal of Public Economics, Elsevier, vol. 95(1), pages 149-163.
    10. David H. Autor, 2015. "The unsustainable rise of the disability rolls in the United States: causes, consequences and policy options," Chapters, in: John Karl Scholz & Hyungypo Moon & Sang-Hyup Lee (ed.), Social Policies in an Age of Austerity, chapter 5, pages 107-136, Edward Elgar Publishing.
    11. repec:aei:rpbook:24945 is not listed on IDEAS
    12. Pascale Lengagne, 2016. "Experience Rating and Work-Related Health and Safety," Journal of Labor Research, Springer, vol. 37(1), pages 69-97, March.
    13. Ruser, John W, 1991. "Workers' Compensation and Occupational Injuries and Illnesses," Journal of Labor Economics, University of Chicago Press, vol. 9(4), pages 325-350, October.
    14. de Groot, Nynke & Koning, Pierre, 2016. "Assessing the effects of disability insurance experience rating. The case of The Netherlands," Labour Economics, Elsevier, vol. 41(C), pages 304-317.
    15. Pierre Koning & Maarten Lindeboom, 2015. "The Rise and Fall of Disability Insurance Enrollment in the Netherlands," Journal of Economic Perspectives, American Economic Association, vol. 29(2), pages 151-172, Spring.
    16. McCrary, Justin, 2008. "Manipulation of the running variable in the regression discontinuity design: A density test," Journal of Econometrics, Elsevier, vol. 142(2), pages 698-714, February.
    17. Terry Thomason & Silvana Pozzebon, 2002. "Determinants of Firm Workplace Health and Safety and Claims Management Practices," ILR Review, Cornell University, ILR School, vol. 55(2), pages 286-307, January.
    18. Pilar García-Gómez & Hans-Martin Gaudecker & Maarten Lindeboom, 2011. "Health, disability and work: patterns for the working age population," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 18(2), pages 146-165, April.
    19. Pierre Koning, 2009. "Experience Rating and the Inflow into Disability Insurance," De Economist, Springer, vol. 157(3), pages 315-335, September.
    20. Richard Burkhauser & Mary C. Daly, 2011. "The Declining Work and Welfare of People with Disabilities," Books, American Enterprise Institute, number 7631, September.
    21. Bruce, Christopher J & Atkins, Frank J, 1993. "Efficiency Effects of Premium-Setting Regimes under Workers' Compensation: Canada and the United States," Journal of Labor Economics, University of Chicago Press, vol. 11(1), pages 38-69, January.
    22. Jonathan Guryan, 2001. "Does Money Matter? Regression-Discontinuity Estimates from Education Finance Reform in Massachusetts," NBER Working Papers 8269, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Koning, Pierre & van Lent, Max, 2022. "Workers' Moral Hazard and Insurer Effort in Disability Insurance," IZA Discussion Papers 15164, Institute of Labor Economics (IZA).
    2. Nynke de Groot & Pierre Koning, 2022. "A burden too big to bear? The effect of experience‐rated disability insurance premiums on firm bankruptcies and employment," Scandinavian Journal of Economics, Wiley Blackwell, vol. 124(1), pages 214-242, January.
    3. Kyyrä, Tomi & Tuomala, Juha, 2023. "The effects of employers’ disability and unemployment insurance costs on benefit inflows," Labour Economics, Elsevier, vol. 85(C).
    4. Biro, Aniko & Boza, István & Gyetvai, Attila & Prinz, Daniel, 2024. "Health Shocks, Social Insurance, and Firms," IZA Discussion Papers 17069, Institute of Labor Economics (IZA).
    5. Menezes-Filho, Naercio & Politi, Ricardo, 2020. "Estimating the causal effects of private health insurance in Brazil: Evidence from a regression kink design," Social Science & Medicine, Elsevier, vol. 264(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kyyrä, Tomi & Paukkeri, Tuuli, 2018. "Using a Kinked Policy Rule to Estimate the Effect of Experience Rating on Disability Inflow," Working Papers 105, VATT Institute for Economic Research.
    2. Kyyrä, Tomi & Tuomala, Juha, 2023. "The effects of employers’ disability and unemployment insurance costs on benefit inflows," Labour Economics, Elsevier, vol. 85(C).
    3. de Groot, Nynke & Koning, Pierre, 2016. "Assessing the effects of disability insurance experience rating. The case of The Netherlands," Labour Economics, Elsevier, vol. 41(C), pages 304-317.
    4. Nynke de Groot & Pierre Koning, 2022. "A burden too big to bear? The effect of experience‐rated disability insurance premiums on firm bankruptcies and employment," Scandinavian Journal of Economics, Wiley Blackwell, vol. 124(1), pages 214-242, January.
    5. Kyyrä, Tomi & Tuomala, Juha, 2013. "Does experience rating reduce disability inflow?," Working Papers 46, VATT Institute for Economic Research.
    6. Pilar García‐Gómez & Anne C. Gielen, 2018. "Mortality effects of containing moral hazard: Evidence from disability insurance reform," Health Economics, John Wiley & Sons, Ltd., vol. 27(3), pages 606-621, March.
    7. Ayertey, Winfred & Sharifi, Ayyoob & Yoshida, Yuichiro, 2024. "The impact of increase in block pricing on electricity demand responsiveness: Evidence from Ghana," Energy, Elsevier, vol. 288(C).
    8. David Card & David S. Lee & Zhuan Pei & Andrea Weber, 2015. "Inference on Causal Effects in a Generalized Regression Kink Design," Econometrica, Econometric Society, vol. 83, pages 2453-2483, November.
    9. Michihito Ando, 2017. "How much should we trust regression-kink-design estimates?," Empirical Economics, Springer, vol. 53(3), pages 1287-1322, November.
    10. Pierre Koning, 2016. "Privatizing sick pay: Does it work?," IZA World of Labor, Institute of Labor Economics (IZA), pages 324-324, December.
    11. Psacale Lengagne & Anissa Afrite, 2015. "Experience Rating, Incidence of Musculoskeletal Disorders and Related Absences.Results from a Natural Experiment," Working Papers DT69, IRDES institut for research and information in health economics, revised Jul 2015.
    12. Antti Saastamoinen & Mika Kortelainen, 2020. "When Does Money Stick in Education? Evidence from A Kinked Grant Rule," Education Finance and Policy, MIT Press, vol. 15(4), pages 708-735, Fall.
    13. Pascale Lengagne, 2016. "Experience Rating and Work-Related Health and Safety," Journal of Labor Research, Springer, vol. 37(1), pages 69-97, March.
    14. Matthew J. Hill & Jose I. Silva & Judit Vall Castello, 2019. "Act now: The effects of the 2008 Spanish disability reform," Health Economics, John Wiley & Sons, Ltd., vol. 28(7), pages 906-920, July.
    15. Pierre Koning & Paul Muller & Roger Prudon, 2022. "Why Do Temporary Workers Have Higher Disability Insurance Risks Than Permanent Workers?," Tinbergen Institute Discussion Papers 22-024/V, Tinbergen Institute.
    16. Simona Gamba & Niklas Jakobsson & Mikael Svensson, 2022. "The impact of cost-sharing on prescription drug demand: evidence from a double-difference regression kink design," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 23(9), pages 1591-1599, December.
    17. Tomi Kyyrä & Hanna Pesola, 2020. "The Effects of UI Benefits on Unemployment and Subsequent Outcomes: Evidence from a Kinked Benefit Rule," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 82(5), pages 1135-1160, October.
    18. Sarah H. Bana & Kelly Bedard & Maya Rossin‐Slater, 2020. "The Impacts of Paid Family Leave Benefits: Regression Kink Evidence from California Administrative Data," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 39(4), pages 888-929, September.
    19. Pascale Lengagne, 2015. "Workers Compensation Insurance: Incentive Effects of Experience Rating on Work-related Health and Safety," Working Papers DT64, IRDES institut for research and information in health economics, revised Jan 2015.
    20. Tunga Kantarcı & Jan‐Maarten van Sonsbeek & Yi Zhang, 2023. "The heterogeneous impact of stricter criteria for disability insurance," Health Economics, John Wiley & Sons, Ltd., vol. 32(9), pages 1898-1920, September.

    More about this item

    Keywords

    J14; J26; H32; Experience rating; Disability insurance; Early retirement;
    All these keywords.

    JEL classification:

    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jhecon:v:61:y:2018:i:c:p:178-192. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/505560 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.