Activation against absenteeism – Evidence from a sickness insurance reform in Norway, published in Journal of Health Economics Volume 62, November 2018, Pages 60-68

Or why you should take courses that are not for credit and do presentations in class.

In the spring of 2015, I followed a course in microeconometrics at the Department of Economics at the University of Oslo to learn some more econometrics. As part of the course, the students had to present published papers employing the methods from the course. I volunteered to do two such presentations, that both ended up as papers of my own!

For my first presentation, which was on the synthetic control method (SCM), I asked the instructor for that lecture, Tarjei Havnes, if I in stead could present an application of my own. I did not know much about the SCM from before, but in the lecture I noticed that it would fit very well to a recent sickness absence reform in a Norwegian region I had head about from Knut Røed, a colleague at the Frisch Centre. The fact that the seminar schedule was on a few weeks lag from the lectures gave me some time to implement a basic analysis of the reform and put together a presentation. The subsequent positive feedback in the seminar motivated me to develop it into a proper paper, which is now just published in the Journal of Health Economics. The paper if of course much extended since that seminar, but the core remained the same.

The reform in question was a program undertaken by the Norwegian region of Hedmark in 2013. It was aimed at strictly enforcing a requirement that people on long-term sick leave be partly back at work unless explicitly defined as an exception. I found that the reform reduced sickness absenteeism by 12% in the reform region compared to a comparison unit created by a weighted average of similar regions. Thus, making use of the partial work capacity of temporary disabled workers has the potential to reduce long-term absenteeism and bring down social security costs. 

A key graph is below, showing how actual absenteeism in Hedmark (solid line) after the reform diverged from the estimate of absenteeism in the absence of reform (dashed line): 

Fig. 1. Trends in the sickness absence rate in Hedmark and the synthetic control region. Note: The dotted line at the fourth quarter of 2011 indicates the final quarter of the matching period. The dashed line at the second quarter of 2013 indicates the period in which the activation program was introduced.

    The effect is driven by both increased part-time presence of temporary disabled workers and accelerated recovery. Musculoskeletal disorders was the diagnosis group declining the most. I conclude that such an activation strategy represents an alternative to traditional attempts at welfare reform involving stricter screening or reductions in generosity, and may be more compatible with already existing legislation and obligations, as well as easier to find support for across political priorities.

    The paper is freely available for a month here.

    Monthly book roundup – 2018 July

    Books finished in July:
    (Warning: reviews are unpolished and quickly written.)

    A Guide to the Good Life: The Ancient Art of Stoic Joy (2013) by William B. Irvine. Introductory book about stoicism and its value as a philosophy of life. The book serves both as an elementary history of stoicism and an introduction and guide to stoic practice (or at any rate the author’s versions of these). Irvine repeatedly battles the supposed negative connotations of the word “stoic,” which I do not recognize, but I guess that is his experience. To me it was good that the he also spends quite some time marking out the differences between the stoics and the cynics. E.g., I learnt that the cynics placed a much heavier emphasis on asceticism. The concrete advice on various stoic techniques for a good life I found the most valuable:
    -Negative visualization the most important tool. Visualize loss of relatives, friends, material goods etc. Makes us appreciate what we have more.
    -Things that happen to us are relatively insignificant- realize by imagining our reaction if that had happened to others.
    -Think about that an experience might be the last – enjoy and concentrate on it more.
    -Sometimes actually lived as we had lost various things. Both prepares us specifically and for deprivations in general.
    -Wait for need to arise before satisfying it. E.g. thirst.
    The suggestion that we should set as goals as that what we already have, I find somewhat problematic. Being happy with what we have is often good, but may deter improvements and good developments. The counter-argument that a stoic should still strive and has a duty to be useful and not seek fame and fortune, but maybe gain it as a side effect, is somewhat unsatisfying. Recommended. (H/t: Marc Andreessen.)

    The Wild Shore: The Three Californias Triptych, Book 1 (1984) by Kim Stanley Robinson. Life in a small fishing village in 2047 in an isolated US which has been the target of a nuclear attack. A realistic if somewhat boring portrait of life in such a village, which would presumably resemble life in similar villages 100 years ago, and getting in contact with the wider world. Not recommended.

    Ratings and previous books are in the library.

    Monthly book roundup – 2018 April

    Books finished in April:
    (Warning: reviews are unpolished and quickly written.)

    The Wizard and the Prophet: Two Remarkable Scientists and Their Dueling Visions to Shape Tomorrow’s World (2018) by Charles C. Mann. Two approaches to growing population and increased pressure on various resources: Wizards see innovation technological and scientific solutions, Prophets believe in restraint and cutting back. These two schools are represented by the agronomist Norman Borlaug, father of the green revolution (in particular the development of higher-yielding crops) and William Vogt, one of the founders of the environmentalist movement. A good book that contains a lot of what should be common scientific knowledge, however, it is fairly dense at times and one needs to really pay attention to get the material. Unfortunately, I did not have the opportunity to do that at the moment, perhaps another time. Recommended for those who have the ability to pay attention.

    Ratings and previous books are in the library.

    Monthly book roundup – 2018 March

    Books finished in March:
    (Warning: reviews are unpolished and quickly written.)

    Kids These Days: Human Capital and the Making of Millennials (2017) by Malcolm Harris. Argues that today’s adolescents and young adults spend too much time and effort on homework and building a resumé in order to get into college and get a job, and then only obtain precarious employment when eventually in the labor market. These are valid concerns for at least some young people today, however, the book’s hysterical tone, over-generalizations and lack of nuance do not do the author, nor the understanding of and thinking about solutions for these challenges any favors. Not recommended.

    Ratings and previous books are in the library.

    Monthly book roundup – 2018 February

    Books finished in February:
    (Warning: reviews are unpolished and quickly written.)

    The Years of Rice and Salt (2015) by Kim Stanley Robinson. People being reincarnated between different “realms” in an alternate history novel. Perhaps I could have worked more on this book, but I am not such a fan of these things, so I put it down quite quickly.

    Nutshell (2016) by Ian McEwan. Love triangle. I did not relate to the characters, who could have done with a more even distribution of sympathetic traits. The plot with a fetus as storyteller was mostly weird. Did not finish.

    Ratings and previous books are in the library.

    Monthly book roundup – 2018 January

    Books finished in January:
    (Warning: reviews are unpolished and quickly written.)

    The Rise and Fall of D.O.D.O.: A Novel (2017) by Nicole Galland and Neal Stephenson. It takes a lot to get stories of time travels to work, and this book does not make it. Too much that is not realistic and indeed fantasylike in my opinion. I quit it about halfway through. Not one of Stephenson’s best.

    Ratings and previous books are in the library.

    Monthly book roundup – 2017 December

    Books finished in December:
    (Warning: reviews are unpolished and quickly written.)

    Tenth of December: Stories (2013) by George Saunders. Short stories. The most memorable one is The Semplica-Girl Diaries, a tragicomic story of a short-sighted couple making a mess of things also published in the New Yorker. Key ingredients of that story are the eponymous (human) Semplica-girls. Funny and serious. Recommended.

    Ratings and previous books are in the library.