Do economic incentives affect work absence? Empirical evidence using Swedish micro data

Using a linear demand function, frequently used in labour supply studies, absenteeism is modelled as an individual day-to-day decision. The parameters in the econometric model are consistently estimated, using the (time-aggregated) number of days absent in 1981 as the dependent variable for a sample of Swedish blue-collar workers (both men and women), under some assumptions on unobserved heterogeneity and serial correlation. Implications of compensating wage differentials and efficiency wage hypotheses are discussed. The results for the male subsample reveal a negative effect on work absence of the direct cost of being absent. However, for the female subsample, the Slutsky condition is rejected.