Absenteeism, Efficiency Wages, and Marginal Taxes

Dale‐Olsen, Harald

doi:10.1111/sjoe.12028

Cited by 30 publications

(20 citation statements)

References 41 publications

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“…We take worker absenteeism as a measure of effort, for which we follow a broad literature (Johansson and Palme, 1996;Barmby and Stephen, 2000;Chatterji and Tilley, 2002;Røed and Fevang, 2007;Lanfranchi and Treble, 2010;Treble and Barmby, 2011;Hesselius et al, 2013;Dale-Olsen, 2013;Ziebarth and Karlsson, 2014). Hours of work is a less suitable measure of effort for this particular firm, because there is hardly any variation in the contractual hours and overtime of work.…”

Section: The Firmmentioning

confidence: 99%

Worker Morale and Effort: Is the Relationship Causal?

Hassink

Fernández²

2017

The Manchester School

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We investigate a unique setting which enables us to distinguish between two theories of work performance. A standard labor supply framework implies a negative effect of the nonpecuniary cost of work on the employee's effort. In contrast, a model of worker morale that is consistent with a widely used theory of Akerlof and Yellen (QJE, 1990) predicts this negative effect is stronger (weaker) for low‐morale (high‐morale) workers. We exploit a natural experiment design of a firm relocation from Milwaukee's Central Business District to the area's suburban ring in 1992. There is an exogenous source of variation on the adjusted commuting distance among those who stay at the firm. Some workers received a windfall gain, whereas other workers experienced an unforeseen cost in longer commuting time. The estimates suggest that low‐morale workers are responsive to the shock in commuting time for some of the dimensions of morale. We conclude that the results give some indication of the model of worker morale.

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Section: The Firmmentioning

confidence: 99%

Worker Morale and Effort: Is the Relationship Causal?

Hassink

Fernández²

2017

The Manchester School

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“…Ljunge (2010) identifies a substantial elasticity of sick leave among a 3 percent sample of the Swedish population from 1974 to 1990, with sick leave varying by −0.7 with respect to the net-of-tax rate. Motivated by a classical efficiency model (Barmby et al, 1994), Dale-Olsen (2013) identifies similar negative elasticities of −0.3 to −0.6 with respect to the net-of-tax rate for all prime-age male workers in Norway between 2001 and 2004, even when accounting for fixed job effects and for different industries, occupations, and income brackets. Thus, the empirical evidence strongly indicates that the higher the marginal labour-related income tax workers face, the more likely they are to become absent and the longer they stay absent.…”

Section: The Norwegian Tax Reform Of 2006 and The Relationship Bementioning

confidence: 99%

Imitation, Contagion, or Exertion? Using a Tax Reform to Reveal How Colleagues' Sick Leaves Influence Worker Behaviour

Dale‐Olsen

Østbakken

Schøne

2014

Scandinavian J Economics

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We analyse social interaction effects in sick-leave behaviour at the workplace, using high-quality Norwegian matched employer-employee data with detailed individual information on sick leaves during the 2004 -2006 period. The analysis finds that social interaction effects on sick leaves in the workplace do exist, and the effects are noticeable in size. The strong relationship between the sick leave rates among colleagues is not solely due to contagious diseases, nor is it caused by improved informational quality or by the increased workload for the non-absent workers.Evidence supports the existence of reciprocal worker behaviour that is unrelated to joint leisureseeking activities.

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“…13 In 1974 sick leave benefits became taxable income 14 and data on the benefits become available. The replacement rate for lost earnings due to sickness was set to 90%.…”

Section: The Sick Leave Programmentioning

confidence: 99%

“…16 The analysis can't be extended further than 1990 since other 12 Benefits are paid by the social insurance office directly to the claimant. 13 The sick leave program was passed into law in 1962 (SFS 1962:381) and it took effect in 1963. 14 The updates to the program are detailed in law SFS 1973:465.…”

Section: The Sick Leave Programmentioning

confidence: 99%

Sick of Taxes? - Evidence on the Elasticity of Labor Supply When Workers are Free to Choose

Ljunge

2011

SSRN Journal

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I estimate a price elasticity of sickness absence. Sick leave is an intensive margin of labor supply where individuals are free to adjust. I exploit variation in tax rates over two decades, which provide thousands of differential incentives across time and space, to estimate the price responsiveness. High taxes provide an incentive to take more sick leave, as less after tax income is lost when taxes are high. The panel data, which is representative of the Swedish population, allow for extensive controls including unobserved individual characteristics. I find a substantial price elasticity of sick leave, -0.7, with respect to the net of tax rate. Though large relative to traditional labor supply elasticities, Swedes are half as price elastic as bike messengers, and just as elastic as stadium vendors on the margin which they can adjust freely.JEL codes: H31, I31, J22

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Absenteeism, Efficiency Wages, and Marginal Taxes

Cited by 30 publications

References 41 publications

Worker Morale and Effort: Is the Relationship Causal?

Worker Morale and Effort: Is the Relationship Causal?

Imitation, Contagion, or Exertion? Using a Tax Reform to Reveal How Colleagues' Sick Leaves Influence Worker Behaviour

Sick of Taxes? - Evidence on the Elasticity of Labor Supply When Workers are Free to Choose

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