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The effect of health insurance on married female labor supply

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Author Info
Thomas C. Buchmueller
Robert G. Valletta

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Abstract

We investigate the effects of employer-provided health insurance on the labor supply of married women. Because health benefits commonly are restricted to full-time workers, wives who prefer to work short hours but have no alternate source of insurance may work long hours in order to acquire coverage for their families. We use data from the April 1993 Current Population Survey Benefits Supplement, and we exploit variation in coverage under husbands' health plans to estimate the magnitude of this effect. Our reduced-form labor supply models indicate a strong negative effect of husbands' health insurance on wives' work hours. This effect persists when we replace husbands' insurance coverage with husbands' offered insurance, and when we use a multinomial logit model that accounts for unobserved heterogeneity in family labor supply preferences.

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Publisher Info
Paper provided by Federal Reserve Bank of San Francisco in its series Working Papers in Applied Economic Theory with number 96-09.

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Date of creation: 1996
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Publication status: Published in Journal of Human Resources (Winter 1999, v. 34, no. 1, pp. 42-70)
Handle: RePEc:fip:fedfap:96-09

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Keywords: Insurance; Health ; Labor supply;

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  1. Shin-Yi Chou & Jin-Tan Liu & James K. Hammitt, 2002. "Health Insurance and Households' Precautionary Behaviors - An Unusual Natural Experiment," NBER Working Papers 9394, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  2. Jason Murasko, 2008. "Married Women’s Labor Supply and Spousal Health Insurance Coverage in the United States: Results from Panel Data," Journal of Family and Economic Issues, Springer, vol. 29(3), pages 391-406, September. [Downloadable!] (restricted)
  3. Younghwan Song, 2007. "The working spouse penalty/premium and married women’s labor supply," Review of Economics of the Household, Springer, vol. 5(3), pages 279-304, September. [Downloadable!] (restricted)
  4. Jody Schimmel, 2006. "Men With Health Insurance and the Women Who Love Them: the Effect of a Husband's Retirement on His Wife's Health Insurance Coverage," Working Papers wp131, University of Michigan, Michigan Retirement Research Center. [Downloadable!]
  5. Cathy J. Bradley & David Neumark & Zhehui Luo & Heather L. Bednarek, 2005. "Employment-Contingent Health Insurance, Illness and Labor Supply of Women: Evidence from Married Women with Breast Cancer," IZA Discussion Papers 1577, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  6. Jeanne S. Ringel & Jacob Alex Klerman, 2005. "Today or Last Year? How Do Interviewees Answer the CPS Health Insurance Questions?," Working Papers 288, RAND Corporation Publications Department. [Downloadable!]
  7. Danilo Cavapozzi, 2008. "Health and Labor Supply Dynamics of Older Married Workers," "Marco Fanno" Working Papers 0073, Dipartimento di Scienze Economiche "Marco Fanno". [Downloadable!]
  8. James Marton & Stephen A. Woodbury, 2006. "Retiree Health Benefits and Retirement," Staff Working Papers 06-128, W.E. Upjohn Institute for Employment Research. [Downloadable!] (restricted)
  9. Akinori Tomohara & Ho Lee, 2007. "Did State Children’s Health Insurance Program Affect Married Women’s Labor Supply?," Journal of Family and Economic Issues, Springer, vol. 28(4), pages 668-683, December. [Downloadable!] (restricted)
  10. Stephen A. Woodbury & James Marton, 2006. "Retiree Health Benefit Coverage and Retirement," Economics Working Paper Archive wp_470, Levy Economics Institute, The. [Downloadable!]
  11. Karen Leppel, 2005. "Labor force plans and labor force status," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 12(8), pages 173-196, April. [Downloadable!]
  12. Cathy J. Bradley & Heather Bednarek & David Neumark, 2001. "Breast Cancer Survival, Work, and Earnings," NBER Working Papers 8134, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  13. Brigitte Madrian, 2006. "The U.S. Health Care System and Labor Markets," NBER Working Papers 11980, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  14. Laura Bucila, 2008. "Employment-Based Health Insurance and the Minimum Wage," Working Papers 0812, College of the Holy Cross, Department of Economics. [Downloadable!]
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