
Thomas J. Kniesner and John D. Leeth
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and at 0.310, well within the range of other estimates in Table 9.3, but the elasticity after
1990 is near zero and statistically insignificant.
9.5.3.4 Experience Rating
Theoretically, the relationship between injuries and workers’ compensation benefit gen-
erosity cannot be determined. Expanding indemnity benefits raises the cost of accidents
to firms, but lowers the cost of accidents to workers. If worker incentives dominate, then
workplace accidents rise. If firm incentives dominate, then accidents fall. And if the two
forces counteract each other, accidents remain constant.
As can be seen from the first-order ...