CHE Seminar Series: The incentive effects of sickness benefit for the unemployed – Analysis of a reduction in potential benefit duration
We examine the impact of Hungary’s “sickness benefit for the unemployed” (SBU) on benefit claiming and employment. Before 2007, in Hungary, individuals could claim sickness benefits within three days of job loss, extending nonemployment benefits by up to 90 days. This created strong incentives to report sick at unemployment onset. In 2007, the maximum SBU duration was halved. We find that higher-income workers and those with longer employment histories were more likely to claim sickness benefits, even after controling for health status. Based on benefit rules they gained most from substituting sickness benefits for unemployment benefits. Following the reform, many lost sickness benefit days were replaced by unemployment insurance benefits. Finally, the reform shifted job-finding patterns: reducing exits from nonemployment immediately after the pre-reform maximum and increasing exits after the new maximum duration. Our results contribute to the literature on the interplay between unemployment and sickness insurance benefits.
Speaker profile
Lili Mark is an applied microeconomist specializing in labor, health, and public economics. She earned her PhD in Economics from Central European University in Vienna. Her research examines how public policies—such as parental leave, sickness benefits, and payroll taxes—affect labor market outcomes. She was a visiting student researcher at Columbia University in New York. Prior to her doctoral studies, she worked as a policy analyst at the Budapest Institute for Policy Analysis and the Government Transparency Institute. She is currently based in Melbourne, Australia.
Weekly seminar series
As part of our Centre's vibrant research culture, we host a weekly seminar series. Visiting and invited researchers present current research relating to the economics of health and wellbeing, and the healthcare sector. Visitors are welcome to join these sessions where discussion and debate is encouraged.
For further information on our seminar series, please contact Trong-Anh.Trinh@monash.edu .
Event Details
- Date:
- 22 April 2026 at 12:00 pm – 1:00 pm
- Venue:
- Caulfield campus, Building C, level 1, room C1.21
- Categories:
- CHE Seminar; General
Description
We examine the impact of Hungary’s “sickness benefit for the unemployed” (SBU) on benefit claiming and employment. Before 2007, in Hungary, individuals could claim sickness benefits within three days of job loss, extending nonemployment benefits by up to 90 days. This created strong incentives to report sick at unemployment onset. In 2007, the maximum SBU duration was halved. We find that higher-income workers and those with longer employment histories were more likely to claim sickness benefits, even after controling for health status. Based on benefit rules they gained most from substituting sickness benefits for unemployment benefits. Following the reform, many lost sickness benefit days were replaced by unemployment insurance benefits. Finally, the reform shifted job-finding patterns: reducing exits from nonemployment immediately after the pre-reform maximum and increasing exits after the new maximum duration. Our results contribute to the literature on the interplay between unemployment and sickness insurance benefits.
Speaker profile
Lili Mark is an applied microeconomist specializing in labor, health, and public economics. She earned her PhD in Economics from Central European University in Vienna. Her research examines how public policies—such as parental leave, sickness benefits, and payroll taxes—affect labor market outcomes. She was a visiting student researcher at Columbia University in New York. Prior to her doctoral studies, she worked as a policy analyst at the Budapest Institute for Policy Analysis and the Government Transparency Institute. She is currently based in Melbourne, Australia.
Weekly seminar series
As part of our Centre's vibrant research culture, we host a weekly seminar series. Visiting and invited researchers present current research relating to the economics of health and wellbeing, and the healthcare sector. Visitors are welcome to join these sessions where discussion and debate is encouraged.
For further information on our seminar series, please contact Trong-Anh.Trinh@monash.edu .