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Elderly Health and Salaries in the Mexican Labor Market

  • Susan W. Parker

The main purpose of this paper is to investigate the determinants of elderly health in the context of Mexico as a developing country and the relationship between health indicators and earnings in the labor market. The authors analyze the determinants of elderly health in Mexico, considering a number of different measures of health status, and use these indicators to evaluate the impact of health on the income of working elderly individuals. The results find that health measures have a strong negative effect on wages for male elderly workers. The lowest point estimations demonstrate that poor health lowers hourly earnings by 58 percent. These are sizable effects, particularly within the context of a developing country, which does not have a universal social security system. Poor health may also prevent others from working, and thereby contribute to high poverty rates among the elderly.

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Paper provided by Inter-American Development Bank in its series IDB Publications (Working Papers) with number 43098.

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Date of creation: Jan 1999
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Handle: RePEc:idb:brikps:43098
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  1. Steven Stern, 1989. "Measuring the Effect of Disability on Labor Force Participation," Journal of Human Resources, University of Wisconsin Press, vol. 24(3), pages 361-395.
  2. Gruber, J. & Madrian, B.C., 1994. "Health Insurance Availability and the Retirement Decision," Working papers 94-04, Massachusetts Institute of Technology (MIT), Department of Economics.
  3. Thomas, Duncan & Strauss, John, 1997. "Health and wages: Evidence on men and women in urban Brazil," Journal of Econometrics, Elsevier, vol. 77(1), pages 159-185, March.
  4. Behrman, Jere R., 1993. "The economic rationale for investing in nutrition in developing countries," World Development, Elsevier, vol. 21(11), pages 1749-1771, November.
  5. Schultz, T-P, 1996. "Wage and Labor Supply effects of Illness in Cote d'Ivoire and Ghana : Instrumental Variable Estimates for Days Disabled," Papers 757, Yale - Economic Growth Center.
  6. Peracchi, Franco & Welch, Finis, 1994. "Trends in Labor Force Transitions of Older Men and Women," Journal of Labor Economics, University of Chicago Press, vol. 12(2), pages 210-42, April.
  7. Kathryn H. Anderson & Richard V. Burkhauser, 1985. "The Retirement-Health Nexus: A New Measure of an Old Puzzle," Journal of Human Resources, University of Wisconsin Press, vol. 20(3), pages 315-330.
  8. Schultz, T. Paul, 1997. "Assessing the productive benefits of nutrition and health: An integrated human capital approach," Journal of Econometrics, Elsevier, vol. 77(1), pages 141-158, March.
  9. 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.
  10. Dora L. Costa, 1994. "Health and Labor Force Participation of Older Men, 1900-1991," NBER Working Papers 4929, National Bureau of Economic Research, Inc.
  11. 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.
  12. Johnson, Richard W & Neumark, David, 1996. "Wage Declines among Older Men," The Review of Economics and Statistics, MIT Press, vol. 78(4), pages 740-48, November.
  13. Clark, Robert L & Anker, Richard, 1993. "Cross-national Analysis of Labor Force Participation of Older Men and Women," Economic Development and Cultural Change, University of Chicago Press, vol. 41(3), pages 489-512, April.
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