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on Insurance Economics |
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Issue of 2005‒10‒15
seven papers chosen by Soumitra K Mallick Indian Institute of Social Welfare and Bussiness Management |
| By: | David Rae |
| Abstract: | Sweden’s single biggest economic problem is the high number of people absent from work due to sickness or disability. This paper describes the problem and looks at what other countries have done to reduce absenteeism. It emphasises a mutual obligations approach to sickness insurance. This means placing greater responsibilities on the sick person, the employer and the social insurance office to get that person back to work as soon as possible. <P>Réduire l'incidence des congés de maladie en Suède Le principal problème économique de la Suède est le taux élevé d’absentéisme pour cause de maladie ou d’invalidité. Cette communication expose le problème et examine les mesures prises par d’autres pays pour y remédier. Il souligne l’importance de fonder le système d’assurance-maladie sur le principe de l’obligation mutuelle. Ceci suppose de responsabiliser davantage le travailleur malade, l’employeur et le bureau d’assurance sociale pour que l’intéressé reprenne son activité le plus rapidement possible. |
| Keywords: | offre de travail, labour supply, sickness insurance, moral hazard, assurance maladie, aléa moral |
| JEL: | I38 J20 |
| Date: | 2005–09–19 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:442-en&r=ias |
| By: | Johnson Adari (BlueCross BlueShield of Tennessee) |
| Abstract: | The economic cost of the U.S. health care system goes beyond the cost of prescription drugs, doctor office visits and surgical procedures/ medical image tests. The implicit part of the cost includes the global competitiveness that the U.S. loses being an industrialized economy. The high health care costs drive jobs, human capital and technology to countries where wages and health care costs are lower as companies attempt to survive. This holistic perception to health care cost is a precursor to intersystem competition that will yield better quality and efficiency thus lowering the cost of health care in the U.S. |
| Keywords: | Health economics , Health insurance, Competition |
| JEL: | C7 D8 |
| Date: | 2005–10–10 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpga:0510003&r=ias |
| By: | Toshihiro Ihori (Faculty of Economics, University of Tokyo); Ryuta Ray Kato (Graduate School of International Relations, International Univesity of Japan); Masumi Kawade (Faculty of Economics, Niigata University); Shun-ichiro Bessho (Policy Research Institute, Ministry of Finance, Japanese Government) |
| Abstract: | This@paper@examines@the@effects of the demographic change and the government debt policy in Japan on economic growth and economic welfare, particularly by taking into account the existing public pension scheme as well as national medical expenditure through the existing public health insurance, wherea computational overlapping generations model is used within a general equilibrium context. One of the main results of this paper is that the tax burden (GDP) ratio will increase up to about 36%, and the social security burden (GDP) ratio will increase up to 23.3% in 2050, even though the government tries to have a positive primary balance by 2010. The ratio of public health insurance bene?ts to GDP is expected to increase at 1% every 10years, and the ratio will be around 9.6%in 2050. The 2004 public pension reform will successfully result in a 13 point decrease in the contribution rate from 36.44% to 23.53%, and reduce the social security burden (GDP) ratio by about 8 points from 23.27% to 15.02% in 2050, compared with the benchmark case. |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:tky:fseres:2005cf372&r=ias |
| By: | Doh-Shin Jeon; Domenico Menicucci |
| Abstract: | We consider the agency problem of a bank staff member managing microfinancing programs, who can abuse his discretion to embezzle borrowers' repayments. In this context, we study the optimal lending contract. The fact that most borrowers of microfinancing programs are illiterate and live in rural areas where transportation costs are very high make staff's embezzlement particularly relevant as is documented by Mknelly and Kevane (2002). We study the trade-off between the optimal rigid contract and the optimal discretionary contract and how joint liability affects the performance of each contract and the trade-off. Our analysis explains rigid repayment schedules used by the Grameen bank as an optimal response to the bank staff's agency problem. Joint liability reduces borrowers' burden of respecting the rigid repayment schedules by providing them with partial insurance. However, the same insurance can be provided by borrowers themselves under individual liability through a side-contract. We also find that the staff's agency problem creates biases in project selection toward projects of small scale and small risk. |
| Keywords: | Microfinance, Group Lending, Joint Liability, Embezzlement, Hierarchy, Contract |
| JEL: | O16 D82 G20 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:893&r=ias |
| By: | James S. Costain; Michael Reiter |
| Abstract: | We construct and calibrate a general equilibrium business cycle model with unemployment and precautionary saving. We compute the cost of business cycles and locate the optimum in a set of simple cyclical fiscal policies. Our economy exhibits productivity shocks, giving firms an incentive to hire more when productivity is high. However, business cycles make workers' income riskier, both by increasing the unconditional probability of unusually long unemployment spells, and by making wages more variable, and therefore they decrease social welfare by around one-fourth or one-third of 1% of consumption. Optimal fiscal policy offsets the cycle, holding unemployment benefits constant but varying the tax rate procyclically to smooth hiring. By running a deficit of 4% to 5% of output in recessions, the government eliminates half the variation in the unemployment rate, most of the variation in workers'aggregate consumption, and most of the welfare cost of business cycles. |
| Keywords: | Real business cycles, matching, precautionary saving, unemployment insurance, fiscal policy, incomplete markets, heterogeneity, computation |
| JEL: | E24 E32 E62 E63 H21 J64 J65 |
| Date: | 2004–11 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:890&r=ias |
| By: | Robert Shimer; Ivan Werning |
| Abstract: | We study the optimal design of unemployment insurance for workers sampling job opportunities over time. We focus on the optimal timing of benefits and the desirability of allowing workers to freely access a riskless asset. When workers have constant absolute risk aversion preferences it is optimal to use a very simple policy: a constant benefit during unemployment, a constant tax during employment that does not depend on the duration of the spell, and free access to savings using a riskless asset. Away from this benchmark, for constant relative risk aversion preferences, the welfare gains of more elaborate policies are minuscule. Our results highlight two largely distinct roles for policy toward the unemployed: (a) ensuring workers have sufficient liquidity to smooth their consumption; and (b) providing unemployment benefits that serve as insurance against the uncertain duration of unemployment spells. |
| JEL: | D82 J65 |
| Date: | 2005–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11689&r=ias |
| By: | Hesselius, Patrik (IFAU - Institute for Labour Market Policy Evaluation); Johansson, Per (IFAU - Institute for Labour Market Policy Evaluation); Larsson, Laura (IFAU - Institute for Labour Market Policy Evaluation) |
| Abstract: | The paper exploits a unique social experiment carried out in 1988 in Sweden to identify the effect of monitoring on sickness absence. The treatment consists of postponing the first formal point of monitoring during a sickness absence spell, a requirement for a doctor’s certificate, from day eight to day fifteen. The experiment was conducted in two geographical areas, and the treatment group was randomized by birth date. The results show strong effects on sickness absence duration from extending the waiting period in both areas. On average, the durations increased by 6.6 percent. No effect on incidence of sickness absence is found. A heterogeneity analysis reveals that monitoring affects men more than women. |
| Keywords: | Absenteeism; sickness insurance; monitoring; social experiment |
| JEL: | H55 I18 J22 J28 |
| Date: | 2005–06–19 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2005_015&r=ias |