Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/34613 
Year of Publication: 
2007
Series/Report no.: 
IZA Discussion Papers No. 2947
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
The paper presents a general equilibrium model of search unemployment that incorporates absence from work as a distinct labor force state. Absenteeism is driven by random shocks to the value of leisure that are private information to the workers. Firms maximize profits while recognizing that the compensation package may affect the queue of job applicants and the absence rate. The analysis provides results concerning the effects of social insurance benefits and other determinants of workers' and firms' behavior. The normative anlysis identifies externalities associated with firm-provided sick pay and examines the welfare implications of alternative policies.
Document Type: 
Working Paper

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