Sweden, Norway, and the Netherlands

I have received a couple of questions about why I only referred to Sweden, Norway, and the Netherlands in my recent post on sick leave.

First of all, I also referred to the "average European" country. More important, I emphasized those three countries because that's where the literature was focused (my post was very clear that it was not original research, but rather a report on what economists had published on the subject). This study noted both the incentives and the outcomes in those three countries (see the abstract shown in its cover page). Several studies have focused on Sweden alone.

One of the academic papers was featured in my chart, and that study very clearly explained "There is a large body of Swedish literature providing empirical evidence of strong moral hazard effects of the insurance system. See, for example, Andre´ n (2001a, 2001b, and 2003); Johansson and Palme (1996 and 2002); Skogman Thoursie; and Henrekson and Persson (2004). Skogman Thoursie (2002), for example, finds a noticeable increase in men’s sickness absence when popular sports events take place." Hence, the title of my post "Home Sick: Another Example Where Incentives Matter."

Apparently, the message that "incentives matter" is unwelcome among most New York Times readers. Customer is king: maybe that's why Professor Krugman always chooses to omit this critical fact from his writings there.