Workers' Compensation and the Distribution of Occupational Injuries

Abstract

This paper studies the impact of workers' compensation income benefits on injury rates and on the distribution of injuries by severity. I develop econometric models for correlated counts of injuries that are estimated on a longitudinal data set of 2,798 manufacturing establishments. I find that higher benefits increase the frequencies of most nonfatal injuries, but reduce the frequency of fatalities. Also, higher benefits increase the probability that a given injury involves days away from work, but reduces the chance that it is a fatality or a minor injury.