The cost of sickness: on the effect of the duration of sick leave on post-sick leave earnings.
Studies analysing the effect of the duration of sick leave on subsequent labour market outcomes do not consider the potential endogenous relationship between duration and labour market outcomes. This paper deals with this shortcoming by using a consistent estimator attained through Instrumental Variables methods for estimating the effect of the duration of a sick leave spell on post-sick leave earnings. I use Danish administrative data and a major 2001 reform of the sick leave system as the instrument for duration. I find that the duration of a sick leave spell has both short and long term effects on post-sick leave earnings.
Andersen
Signe Hald
SH
Rockwool Foundation Research Unit, Sejrogade 11, Copenhagen, Denmark. sha@rff.dk
D017281:Cost of Illness; D003718:Denmark; D004651:Employment / Q000191:economics / Q000706:statistics & numerical data; D006304:Health Status; D006801:Humans; D007182:Income / Q000706:statistics & numerical data*; D016016:Proportional Hazards Models; D012044:Regression Analysis; D018582:Sick Leave / Q000191:economics / Q000706:statistics & numerical data*; D013997:Time Factors; D014478:Unemployment / Q000706:statistics & numerical data; D014942:Workers' Compensation / Q000191:economics / Q000706:statistics & numerical data