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The effect of health on labour supply in nine former Soviet Union countries

Author

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  • Yevgeniy Goryakin

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  • Lorenzo Rocco
  • Marc Suhrcke
  • Bayard Roberts
  • Martin McKee

Abstract

This paper examines for the first time the consequences of ill health on labour supply for a sample of nine countries from the former Soviet Union (FSU), using a unique multicountry household survey specifically designed for this region. We control for a wide range of individual, household, and community factors, using both standard regression techniques and instrumental variable estimation to address potential endogeneity. Specifically, we find in our baseline ordinary least squares specification that poor health is associated with a decrease in the probability of working of about 13 %. Controlling for community-level unobserved variables slightly increases the magnitude of this effect, to about 14 %. Controlling for endogeneity with the instrumental variable approach further supports this finding, with the magnitude of the effect ranging from 12 to 35 %. Taken together, our findings confirm the cost that the still considerable adult health burden in the FSU is imposing on its population, not only in terms of the disease burden itself, but also in terms of individuals’ labour market participation, as well as potentially in terms of increased poverty risk. Other things being equal, this would increase the expected “return on investment” to be had from interventions aimed at improving health in this region. Copyright Springer-Verlag Berlin Heidelberg 2014

Suggested Citation

  • Yevgeniy Goryakin & Lorenzo Rocco & Marc Suhrcke & Bayard Roberts & Martin McKee, 2014. "The effect of health on labour supply in nine former Soviet Union countries," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 15(1), pages 57-68, January.
  • Handle: RePEc:spr:eujhec:v:15:y:2014:i:1:p:57-68
    DOI: 10.1007/s10198-012-0455-y
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Gimenez-Nadal, J. Ignacio & Molina, Jose Alberto, 2015. "Health status and the allocation of time: Cross-country evidence from Europe," Economic Modelling, Elsevier, vol. 46(C), pages 188-203.
    2. J. Gimenez-Nadal & Jose Molina, 2016. "Health inequality and the uses of time for workers in Europe: policy implications," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-18, December.
    3. Obrizan, Maksym, 2017. "Does EU membership prevent crowding out of public health care? Evidence from 28 transition countries," MPRA Paper 81708, University Library of Munich, Germany.
    4. Lijian Qin & Chien-Ping Chen & Xun Liu & Chenggang Wang & Zhongyi Jiang, 2015. "Health Status and Earnings of Migrant Workers from Rural China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 23(2), pages 84-99, March.
    5. repec:ris:apltrx:0335 is not listed on IDEAS
    6. Yevgeniy Goryakin & Marc Suhrcke, 2017. "The impact of poor adult health on labor supply in the Russian Federation," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 18(3), pages 361-372, April.
    7. ZHAO Meng (KONISHI Moe), 2017. "Health-Related Income Gaps and the Effectiveness of Redistributive Policies in Japan," Discussion papers 17039, Research Institute of Economy, Trade and Industry (RIETI).

    More about this item

    Keywords

    General health; Labour demand and supply; Former Soviet Union; Instrumental variables; J2; I1;

    JEL classification:

    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • I1 - Health, Education, and Welfare - - Health

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