Scandinavian Working Papers in Economics

Working Paper Series,
IFAU - Institute for Evaluation of Labour Market and Education Policy

No 2004:8: Harmonizing unemployment and sickness insurance: Why (not)?

Laura Larsson ()
Additional contact information
Laura Larsson: IFAU - Institute for Labour Market Policy Evaluation, Postal: P O Box 513, SE-751 20 Uppsala, Sweden

Abstract: The paper discusses harmonization of unemployment insurance (UI) and sickness insurance (SI). The focus is on the difference between the benefit ceilings in the two insurance systems that has been shown to affect the behavior among unemployed SI recipients. The four conclusions are: (i) It is difficult to argue that the design with different benefit ceilings of UI and SI would be optimal. (ii) During the study period 1998–2001, unemployed were overrepresented among SI recipients. (iii) Some of the overrepresentation is due to the different benefit ceilings. Thus, harmonization of the systems is motivated; (iv) In a complex system as the Swedish social insurance system, reducing moral hazard in one group probably also implies various indirect effects. When designing a reform, all insurances should be considered simultaneously.

Keywords: Government policies; moral hazard; sickness insurance; unemployment insurance

JEL-codes: H51; H55; I18; J65

40 pages, June 3, 2004

Full text files

wp04-08.pdf PDF-file 

Download statistics

Questions (including download problems) about the papers in this series should be directed to Ali Ghooloo ()
Report other problems with accessing this service to Sune Karlsson ().

This page generated on 2018-03-18 13:49:12.