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Dynamics of health and labor market risks

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  • Haan, Peter
  • Myck, Michal

Abstract

While there is little doubt that the probability of poor health increases with age, and that less healthy people face a more difficult situation on the labor market, the precise relationship between facing the risks of health deterioration and labor market instability is not well understood. Using 12 years of data from the German Socio-Economic Panel we study the nature of the relationship between poor health and non-employment on a sample of German men aged 30-59. We propose a joint model of health and labor market risks which identifies the mechanism through which poor health contributes to the probability of being jobless and vice versa. We find an important role of unobserved heterogeneity and evidence for correlation in the unobservable characteristics determining the two processes. The results also show strong persistence in the dynamics of health and labor market risks.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Health Economics.

Volume (Year): 28 (2009)
Issue (Month): 6 (December)
Pages: 1116-1125

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Handle: RePEc:eee:jhecon:v:28:y:2009:i:6:p:1116-1125

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Web page: http://www.elsevier.com/locate/inca/505560

Related research

Keywords: Poor health Labor market risk Self-assessed health Ageing Dynamic panel data;

References

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Citations

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Cited by:
  1. Kurowska, Anna & Myck, Michal & Wrohlich, Katharina, 2012. "Family and Labor Market Choices: Requirements to Guide Effective Evidence-Based Policy," IZA Discussion Papers 6846, Institute for the Study of Labor (IZA).
  2. Maja Adena & Michal Myck, 2013. "Poverty and Transitions in Health," Discussion Papers of DIW Berlin 1319, DIW Berlin, German Institute for Economic Research.
  3. Daniel Kemptner, 2013. "Health-Related Life Cycle Risks and Public Insurance," SOEPpapers on Multidisciplinary Panel Data Research 583, DIW Berlin, The German Socio-Economic Panel (SOEP).
  4. Johannes Geyer, 2011. "The Effect of Health and Employment Risks on Precautionary Savings," SOEPpapers on Multidisciplinary Panel Data Research 408, DIW Berlin, The German Socio-Economic Panel (SOEP).
  5. Thomas Barnay & François Legendre, 2012. "Simultaneous causality between health status and employment status within the population aged 30-59 in France," Working Papers halshs-00856217, HAL.
  6. Michał Myck, 2011. "Policy challenges in Germany and Poland: what can we learn from the SHARE data," Ekonomia journal, Faculty of Economic Sciences, University of Warsaw, vol. 28.
  7. Jule Specht & Boris Egloff & Stefan C. Schmukle, 2012. "Everything under Control?: The Effects of Age, Gender, and Education on Trajectories of Perceived Control in a Nationally Representative German Sample," SOEPpapers on Multidisciplinary Panel Data Research 445, DIW Berlin, The German Socio-Economic Panel (SOEP).
  8. Börsch-Supan, Axel & Brandt, Martina & Schröder, Mathis, 2013. "SHARELIFE - One Century of Life Histories in Europe," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 1-4.

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