Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/328084 
Year of Publication: 
2020
Citation: 
[Journal:] Review of Economic Analysis (REA) [ISSN:] 1973-3909 [Volume:] 12 [Issue:] 1 [Year:] 2020 [Pages:] 89-127
Publisher: 
International Centre for Economic Analysis (ICEA), Waterloo (Ontario)
Abstract: 
We analyze the effect of employer-sponsored health insurance premiums on employment and annual wages in the US using a county-level panel dataset for the period 2005-2010. Using variation in medical malpractice payments and variation in medical malpractice legislation over time and within states as the source of identifying variation in the health insurance premiums, we estimate the causal effects of rising health insurance premiums on employment and annual wages. We find that a 10% increase in premiums reduces employment by 1.1 percentage points, and leads to a statistically insignificant reduction of annual wages. Since US counties are characterized by a varying degree of private health insurance coverage, we also test whether the private health insurance coverage is a moderating variable for the relationship between the health insurance premiums and the labor market outcomes analyzed in this study. We find that rising premiums negatively affect the labor market conditions faced by US workers, especially in areas that are characterized by high private health insurance coverage.
Subjects: 
Employer-sponsored health insurance premiums
Wages
Employment
Panel data
Instrumental variables
JEL: 
I1
I13
J0
J3
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc Logo
Document Type: 
Article

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