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A dynamic analysis of disability and labour force participation in Ireland 1995-2000

  • Brenda Gannon

This paper aims to analyse the effect of disability on participation in the labour force, using the Irish component of the European Community Household Panel Survey 1995-2000. A range of panel models are considered, but to allow for any unobserved influences or state dependence in labour force participation, our preferred model is a dynamic panel model. We show how the estimates of current disability are changed once we control for the effect of past disability and previous participation. We compare base estimates of disability with those controlling for unobserved heterogeneity and past participation. The results suggest that the base effect of disability is overestimated by between 40-60% for men and by 5-10% for women. Copyright © 2005 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/hec.1044
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Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 14 (2005)
Issue (Month): 9 ()
Pages: 925-938

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Handle: RePEc:wly:hlthec:v:14:y:2005:i:9:p:925-938
Contact details of provider: Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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  1. Kreider, Brent, 1999. "Latent Work Disability and Reporting Bias," Staff General Research Papers 5185, Iowa State University, Department of Economics.
  2. 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.
  3. Doreen Wing Han Au & Thomas F. Crossley & Martin Schellhorn, 2004. "The Effect of Health Changes and Long-term Health on the Work Activity of Older Canadians," Social and Economic Dimensions of an Aging Population Research Papers 119, McMaster University.
  4. John Bound & Michael Schoenbaum & Todd R. Stinebrickner & Timothy Waidmann, 1998. "The Dynamic Effects of Health on the Labor Force Transitions of Older Workers," NBER Working Papers 6777, National Bureau of Economic Research, Inc.
  5. Martin Biewen, 2004. "Measuring State Dependence in Individual Poverty Status: Are there Feedback Effects to Employment Decisions and Household Composition?," Discussion Papers of DIW Berlin 429, DIW Berlin, German Institute for Economic Research.
  6. 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.
  7. Mundlak, Yair, 1978. "On the Pooling of Time Series and Cross Section Data," Econometrica, Econometric Society, vol. 46(1), pages 69-85, January.
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