Essays on Sickness Insurance, Absence Certification and Social Norms

Abstract: The thesis consists of an introductory chapter and three essays, considering sickness insurance, social norms and absence certification.

The first essay, Group-Specific Social Norms and Economic Incentives in a General Welfare System, investigates the interaction between economic incentives and social influences in a general welfare system. We relate the results to sickness insurance. The model in Lindbeck, Nyberg & Weibull (1999) is modified by dividing the population into two groups, which are governed by group-specific social work norms. The behaviour of the two groups is studied in separate welfare systems as well as a shared system. We find that group affiliation matters for the generosity of the welfare policy, in terms of tax rate and transfer level, and for the share of transfer recipients. Furthermore, in a first-best scenario, it is observed that a restriction on the recipient share in exchange for a generous transfer may be optimal. Regarding the social norm, we find an ambiguous effect on the optimal welfare policy in a first-best scenario, whereas it implies a transfer increase in a second-best scenario.

In the second essay, Sickness Absence Certification, we model sickness absence certification by assuming that the physician may certify absence for a worker without verifying that his ability to work is impaired due to sickness. Physicians with ?strict? as well as ?lax? sick-listing routines interact with workers who differ in their motivation for work. Depending on the physician type, or types, available and the expectations thereof, ?less motivated? workers are sick-listed regardless of working ability, while ?motivated? workers are sick-listed conditional on the observation of health-related ability impairment. We consider various policy instruments that the insurer may employ against a perceived misuse of the insurance and discuss their welfare implications, taking into account the match between worker and physician as well as the match between labour activity and working ability.

The third essay, Occupational Physicians and General Practitioners ? Implications for Sickness Absence Certification, compares the certification practices of the occupational physician with those of the general practitioner. Whereas the latter adjusts his practices to the preferences of the worker, the former may have a restrictive attitude towards sick-listing, due to the client?s, that is the firm?s, influence. In contrast to the occupational physician's assessment of working ability, the general practitioner's assessment is imprecise, which implies an over-certification of sick-leave claims. Both ?less motivated? and ?motivated? workers prefer physicians with adjustable practices, resulting in different treatments of the workers regarding absence certification, provided that workers are able to attach expectations about treatment to individual physicians. However, ?motivated? workers also prefer correct information about ability, implying a risk of ?involuntary? sickness absence when general practitioners certify absence.