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The Impact of Health on Labor Supply near Retirement

Author

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  • Richard Blundell
  • Jack Britton
  • Monica Costa Dias
  • Eric French

Abstract

Estimates of how health affects employment vary considerably. We assess how different methods and health measures impact estimates of the impact of health on employment using a unified framework for the United States and England. We find that subjective and objective health measures and subjective measures instrumented by objective measures produce similar estimates when using sufficiently rich objective measures. Moreover, a single health index can capture the relevant health variation for employment. Health deterioration explains up to 15 percent of the decline in employment between ages 50 and 70. Effects are larger for the United States than England and for the low educated.

Suggested Citation

  • Richard Blundell & Jack Britton & Monica Costa Dias & Eric French, 2023. "The Impact of Health on Labor Supply near Retirement," Journal of Human Resources, University of Wisconsin Press, vol. 58(1), pages 282-334.
    • Handle: RePEc:uwp:jhriss:v:58:y:2023:i:1:p:282-334
    Note: DOI: 10.3368/jhr.58.3.1217-9240R4
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    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. The impact of health on labour supply near retirement
      by maximorossi in NEP-LTV blog on 2018-02-20 19:27:23

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    2. Vincent VANDENBERGHE, 2021. "Health, cognition and work capacity beyond the age of 50: International evidence on the extensive and intensive margins of work," International Labour Review, International Labour Organization, vol. 160(2), pages 271-310, June.
    3. Chen, Wen-Hao, 2019. "Health and transitions into nonemployment and early retirement among older workers in Canada," Economics & Human Biology, Elsevier, vol. 35(C), pages 193-206.
    4. Naoki Aizawa & Chao Fu, 2020. "Interaction of the Labor Market and the Health Insurance System: Employer-Sponsored, Individual, and Public Insurance," NBER Working Papers 26713, National Bureau of Economic Research, Inc.
    5. Margherita Borella & Mariacristina De Nardi & Fang Yang, 2017. "The Effects of Marriage-Related Taxes and Social Security Benefits," NBER Working Papers 23972, National Bureau of Economic Research, Inc.
    6. Mark L Bryan & Nigel Rice & Jennifer Roberts & Cristina Sechel, 2022. "Mental Health and Employment: A Bounding Approach Using Panel Data," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 84(5), pages 1018-1051, October.
    7. Sime Smolic & Ivan Cipin & Petra Medimurec, 2020. "How is health associated with employment during later working life in Croatia?," Public Sector Economics, Institute of Public Finance, vol. 44(1), pages 99-116.
    8. Landais, Camille & Kolsrud, Jonas & Spinnewijn, Johannes, 2017. "Studying Consumption Patterns using Registry Data: Lessons From Swedish Administrative Data," CEPR Discussion Papers 12402, C.E.P.R. Discussion Papers.
    9. Vandenberghe, Vincent, 2019. "Health, Cognition and Work Capacity Beyond the Age of 50," GLO Discussion Paper Series 295, Global Labor Organization (GLO).
    10. Jessamyn Schaller & Chase Eck, 2019. "Adverse Life Events and Intergenerational Transfers," Upjohn Working Papers 19-309, W.E. Upjohn Institute for Employment Research.
    11. Vincent Vandenberghe, 2020. "The Rather Limited Role Of Mental Ill Health In Driving Work Beyond 50," LIDAM Discussion Papers IRES 2020020, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    12. Bryan, M.; & Roberts, J.; & Sechel, C.;, 2019. "The Effect of Mental Health on Employment:Accounting for Selection Bias," Health, Econometrics and Data Group (HEDG) Working Papers 19/14, HEDG, c/o Department of Economics, University of York.
    13. Anna Amilon & Mona Larsen, 2023. "Increasing retirement ages in Denmark: Do changes in gender, education, employment status and health matter?," European Journal of Ageing, Springer, vol. 20(1), pages 1-10, December.
    14. , 2020. "Why Does Consumption Fluctuate in Old Age and How Should the Government Insure it?," Opportunity and Inclusive Growth Institute Working Papers 40, Federal Reserve Bank of Minneapolis.
    15. White, Matthew N., 2023. "Self-reported health status and latent health dynamics," Journal of Health Economics, Elsevier, vol. 88(C).

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    More about this item

    JEL classification:

    • I10 - Health, Education, and Welfare - - Health - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity

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