Assessing the effect of public policy on worker absenteeism
- Publisher: Uppsala: Institute for Labour Market Policy Evaluation
logit regression | unobserved heterogeneity | J22 | Sickness insurance | Sickness insurance; unobserved heterogeneity; logit regression
We analyze the effect of economic incentives on worker absenteeism, using panel data on work absence for 1990 and 1991 with a sample of 1,396 Swedish blue-collar workers. During this period Sweden implemented major reforms of both its national income replacement program for short-term sickness and income taxes. Both affected the worker's cost of missing work. Our econometric model allows for state-dependent dynamic behavior and control for unobserved heterogeneity. The latter proves to be an important consideration. We find that the cost of being absent significantly affects work absence behavior.