Occupational diseases and provisioning of health care: A case of market failures in coal mining

This paper seeks to measure the economic costs of occupational diseases falling on the workers and management in the coal mining industry. The high incidence of occupational diseases increases health care expenditure by workers, thereby reducing their disposable income. This is an important component of the cost of occupational diseases on the mineworkers. In addition, absenteeism may lead to a direct fall in income as part of the leave taken by the workers is without pay. The total fall in income arising from these two components has been estimated. Absenteeism also reduces mandays and leads to revenue losses. The potential output and revenue losses have also been quantified. However, the presence of moral hazard and information asymmetries has allowed the management to avert this cost.