Effects of Health on Own and Spousal Employment and Income using Acute Hospital Admissions
AbstractIll-health can be expected to reduce employment and income. But are the effects sustained over time? Do they differ across the income distribution? And are there spillover effects on the employment and income of the spouse? We use matching combined with difference-in-differences to identify the causal effects of sudden illness, represented by acute hospitalisations, on employment and income up to six years after the health shock using linked Dutch hospital and tax register data. On average, an acute hospital admission lowers the employment probability by seven percentage points and results in a 5% loss of personal income (30% for those entering disability insurance) two years after the shock. There is no subsequent recovery in either employment or income. The distribution of ill-health contributes to income inequality: a health shock is both more likely to occur and to have a larger relative impact on employment and income at the bottom of the income distr ibution. There are large spillover effects: household income falls by 50% more than the income of the disabled person, and the employment probability of the spouse is reduced by 1.5 percentage points. The negative spousal employment effect is larger for male than for female spouses and in higher income households.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 11-143/2.
Date of creation: 07 Oct 2011
Date of revision:
Contact details of provider:
Web page: http://www.tinbergen.nl
Health; Disability; Employment; Income; Propensity Score Matching;
Find related papers by JEL classification:
- I10 - Health, Education, and Welfare - - Health - - - General
- J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
- J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Martin Halla & Martina Zweimüller, 2011.
"The Effect of Health on Income: Quasi-Experimental Evidence from Commuting Accidents,"
NRN working papers
2011-03, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria, revised Feb 2012.
- Halla, Martin & Zweimüller, Martina, 2011. "The Effect of Health on Income: Quasi-Experimental Evidence from Commuting Accidents," IZA Discussion Papers 5833, Institute for the Study of Labor (IZA).
- Martin Halla & Martina Zweimüller, 2011. "The Effect of Health on Income: Quasi-Experimental Evidence from Commuting Accidents," Economics working papers 2011-04, Department of Economics, Johannes Kepler University Linz, Austria, revised Feb 2012.
- Berkowitz, Monroe & Fenn, Paul & Lambrinos, James, 1983. "The optimal stock of health with endogenous wages : Application to partial disability compensation," Journal of Health Economics, Elsevier, vol. 2(2), pages 139-147, August.
- Debra S. Dwyer & Olivia S. Mitchell, .
"Health Problems as Determinants of Retirement: Are Self-Rated Measures Endogenous?,"
Pension Research Council Working Papers
98-7, Wharton School Pension Research Council, University of Pennsylvania.
- Dwyer, Debra Sabatini & Mitchell, Olivia S., 1999. "Health problems as determinants of retirement: Are self-rated measures endogenous?," Journal of Health Economics, Elsevier, vol. 18(2), pages 173-193, April.
- Debra Sabatini Dwyer & Olivia S. Mitchell, 1998. "Health Problems as Determinants of Retirement: Are Self-Rated Measures Endogenous?," NBER Working Papers 6503, National Bureau of Economic Research, Inc.
- Alan L. Gustman & Thomas L. Steinmeier, 2004.
"Personal Accounts and Family Retirement,"
NBER Working Papers
10305, National Bureau of Economic Research, Inc.
- Courtney Harold Van Houtven & Norma B. Coe, 2010. "Spousal Health Shocks and the Timing of the Retirement Decision in the Face of Forward-Looking Financial Incentives," Working Papers, Center for Retirement Research at Boston College wp2010-6, Center for Retirement Research.
- Disney, Richard & Emmerson, Carl & Wakefield, Matthew, 2006.
"Ill health and retirement in Britain: A panel data-based analysis,"
Journal of Health Economics,
Elsevier, vol. 25(4), pages 621-649, July.
- Richard Disney & Carl Emmerson & Matthew Wakefield, 2003. "Ill health and retirement in Britain: a panel data based analysis," IFS Working Papers W03/02, Institute for Fiscal Studies.
- Bound, John & Burkhauser, Richard V., 1999. "Economic analysis of transfer programs targeted on people with disabilities," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 51, pages 3417-3528 Elsevier.
- Robert Haveman & Mark Stone & Barbara Wolfe, 1989.
"Market Work, Wages, and Men's Health,"
NBER Working Papers
3020, National Bureau of Economic Research, Inc.
- Sergi Jiménez-Mart�n & José M. Labeaga & Cristina Vilaplana Prieto, 2006. "A sequential model of older workers' labor force transitions after a health shock," Health Economics, John Wiley & Sons, Ltd., vol. 15(9), pages 1033-1054.
- Courtney C. Coile, 2004. "Health Shocks and Couples' Labor Supply Decisions," NBER Working Papers 10810, National Bureau of Economic Research, Inc.
- Sascha O. Becker & Andrea Ichino, 2002. "Estimation of average treatment effects based on propensity scores," Stata Journal, StataCorp LP, vol. 2(4), pages 358-377, November.
- Ronald Hagan & Andrew M. Jones & Nigel Rice, 2008. "Health Shocks and the Hazard Rate of Early Retirement in the ECHP," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 144(III), pages 323-335, September.
- Eddy van Doorslaer & Xander Koolman, 2004. "Explaining the differences in income-related health inequalities across European countries," Health Economics, John Wiley & Sons, Ltd., vol. 13(7), pages 609-628.
- Jiménez-Martín, Sergi & Labeaga, José M. & Martínez Granado, Maite, 1999. "Health status and retirement decisions for older European couples," IRISS Working Paper Series 1999-01, IRISS at CEPS/INSTEAD.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Antoine Maartens (+31 626 - 160 892)).
If references are entirely missing, you can add them using this form.