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A sequential model for older workers’ labor transitions after a health shock

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Author Info
Sergi Jiménez-Martín ()
José M. Labeaga
Cristina Vilaplana Prieto

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Abstract

In this work we study older workers’ (50—64) labor force transitions after a health/disability shock. We find that the probability of keeping working decreases with both age and severity of the shock. Moreover, we find strong interactions between age and severity in the 50—64 age range and none in the 30–49 age range. Regarding demographics we find that being female and married reduce the probability of keeping work. On the contrary, being main breadwinner, education and skill levels increase it. Interestingly, the effect of some demographics changes its sign when we look at transitions from inactivity to work. This is the case of being married or having a working spouse. Undoubtedly, leisure complementarities should play a role in the latter case. Since the data we use contains a very detailed information on disabilities, we are able to evaluate the marginal effect of each type of disability either in the probability of keeping working or in returning back to work. Some of these results may have strong policy implications.

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Publisher Info
Paper provided by Department of Economics and Business, Universitat Pompeu Fabra in its series Economics Working Papers with number 898.

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Date of creation: Oct 2005
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Handle: RePEc:upf:upfgen:898

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Related research
Keywords: Health shocks; disability; labor force transitions; older workers; Spain;

Other versions of this item:

Find related papers by JEL classification:
J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
I12 - Health, Education, and Welfare - - Health - - - Health Production

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References listed on IDEAS
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.:
  1. Ian Walker & Adrian Thompson, 1996. "Disability Wages and Labour Force Participation: Evidence from UK Panal Data," Keele Department of Economics Discussion Papers (1995-2001) 96/14, Department of Economics, Keele University.
  2. Brent Kreider & John V. Pepper, 2002. "Disability and Employment: Reevaluating the Evidence in Light of Reporting Errors," Working Papers, Center for Retirement Research at Boston College 2002-06, Center for Retirement Research. [Downloadable!]
    Other versions:
  3. Gruber, Jonathan & Kubik, Jeffrey D., 1997. "Disability insurance rejection rates and the labor supply of older workers," Journal of Public Economics, Elsevier, vol. 64(1), pages 1-23, April. [Downloadable!] (restricted)
  4. Courtney Coile & Jonathan Gruber, 2000. "Social Security and Retirement," NBER Working Papers 7830, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  5. Roger Wilkins, 2004. "The Effects of Disability on Labour Force Status in Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 37(4), pages 359-382, December. [Downloadable!] (restricted)
  6. Heckman, James J & Willis, Robert J, 1977. "A Beta-logistic Model for the Analysis of Sequential Labor Force Participation by Married Women," Journal of Political Economy, University of Chicago Press, vol. 85(1), pages 27-58, February. [Downloadable!] (restricted)
    Other versions:
  7. Kidd, Michael P. & Sloane, Peter J. & Ferko, Ivan, 2000. "Disability and the labour market: an analysis of British males," Journal of Health Economics, Elsevier, vol. 19(6), pages 961-981, November. [Downloadable!] (restricted)
    Other versions:
  8. 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. [Downloadable!]
  9. Hugo Benitez-Silva & Moshe Buchinsky & Hiu-Man Chan & John Rust & Sofia Sheivasser, 1997. "An Empirical Analysis of the Social Security Disability Application, Appeal, and Award Process," Public Economics 9712001, EconWPA, revised 16 Feb 1998. [Downloadable!]
  10. Jonathan Gruber & Jeffrey D. Kubik, 1994. "Disability Insurance Rejection Rates and the Labor Supply of Older Workers," NBER Working Papers 4941, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  11. Jennifer Ward-Batts, 2001. "Health, Wealth and Gender: Do Health Shocks of Husbands and Wives Have Different Impacts on Household Wealth?," Working Papers wp016, University of Michigan, Michigan Retirement Research Center. [Downloadable!]
  12. Diebold, Francis X & Mariano, Roberto S, 1995. "Comparing Predictive Accuracy," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(3), pages 253-63, July.
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  13. Michele Boldrin & Sergi Jimenez-Martni & Franco Peracchi, 1997. "Social Security and Retirement in Spain," NBER Working Papers 6136, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  14. David H. Autor & Mark G. Duggan, 2001. "The Rise in Disability Recipiency and the Decline in Unemployment," JCPR Working Papers 226, Northwestern University/University of Chicago Joint Center for Poverty Research.
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  15. 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. [Downloadable!] (restricted)
    Other versions:
  16. Janet Currie & Brigitte C. Madrian, 1998. "Health, Health Insurance and the Labor Market," JCPR Working Papers 27, Northwestern University/University of Chicago Joint Center for Poverty Research.
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  17. Emile Tompa, 1999. "Transitions to Retirement: Determinants of Age of Social Security Take Up," Social and Economic Dimensions of an Aging Population Research Papers 6, McMaster University. [Downloadable!]
  18. Bound, John & Schoenbaum, Michael & Stinebrickner, Todd R. & Waidmann, Timothy, 1999. "The dynamic effects of health on the labor force transitions of older workers," Labour Economics, Elsevier, vol. 6(2), pages 179-202, June. [Downloadable!] (restricted)
    Other versions:
  19. Dr. Peter Kenning & Hilke Plassmann, 2004. "NeuroEconomics," Experimental 0412005, EconWPA. [Downloadable!]
  20. Riphahn, Regina T., 1998. "Income and Employment Effects of Health Shocks - A Test Case for the German Welfare State," IZA Discussion Papers 10, Institute for the Study of Labor (IZA). [Downloadable!]
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  21. van Ophem, Hans & Schram, Arthur, 1997. "Sequential and Multinomial Logit: A Nested Model," Empirical Economics, Springer, vol. 22(1), pages 131-52.
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Cited by:
(explanations, 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.)

  1. Andrés J. Marchante Mera & Bienvenido Ortega Aguaza & José Sánchez Maldonado, 2006. "Las dimensiones del bienestar en las Comunidades Autónomas Españolas. Un análisis de Sigma y Gamma-Convergencia," Working Papers 2006-05, FEDEA. [Downloadable!]
  2. Pedro N. Rodríguez, & Simón Sosvilla-Rivero, 2006. "Understanding and Forecasting Stock Price Changes," Working Papers 2006-03, FEDEA. [Downloadable!]
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