Health and Retirement of Older New Zealanders
AbstractIncreasing life expectancies and uncertainty about future retirement incomes are likely to lead to various changes in behaviour. As expectations are revised, one potentially important adjustment mechanism is in labour force participation rates. There is already evidence these are rising for those beyond the age of eligibility for New Zealand Superannuation. This paper uses a new source of longitudinal data on the health, labour force participation and retirement decisions of older New Zealanders. The central question addressed is the extent to which labour force participation of older New Zealanders is influenced by their health status (both mental and physical), in addition to a wide range of economic, social and demographic variables. Discrete choice models are employed, and particular attention is given to the potential effects of unobserved heterogeneity. We find a range of factors to be associated with the decision to retire, notably health status, marital status and financial incentives. After accounting for the confounding influence of unobservables, we find that physical health remains a determinant of labour force exit for older males. Further, we estimate both the marginal and aggregate effects of specific chronic conditions on labour force participation.
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Bibliographic InfoPaper provided by New Zealand Treasury in its series Treasury Working Paper Series with number 12/02.
Date of creation: Jun 2012
Date of revision:
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Labour force participation; Health; Retirement; New Zealand; Longitudinal survey;
Find related papers by JEL classification:
- J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
- J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
- J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
- I10 - Health, Education, and Welfare - - Health - - - General
This paper has been announced in the following NEP Reports:
- NEP-AGE-2012-06-25 (Economics of Ageing)
- NEP-ALL-2012-06-25 (All new papers)
- NEP-DEM-2012-06-25 (Demographic Economics)
- NEP-HEA-2012-06-25 (Health Economics)
- NEP-LAB-2012-06-25 (Labour Economics)
- NEP-LMA-2012-06-25 (Labor Markets - Supply, Demand, & Wages)
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