Elderly Health and Salaries in the Mexican Labor Market
Little work exists on elderly health, work and salaries in developing countries. This paper aims to contribute to this literature in the areas of health and income of the elderly. The main purpose of this paper is to investigate the determinants of elderly health in the context of a developing country, Mexico,and the relationship between these health indicators and earnings in the labor market. We analyze the determinants of elderly health in Mexico, considering a number of different measures of health status, and we use these indicators to evaluate the impact of health on the income of working elderly individuals. We use the National Mexican Aging Survey of 1994, which contains detailed self-reported indicators of health as well as labor market information, to tease out these potential relationships. The results find that health measures have a strong negative effect on wages for male elderly workers. Our 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 and may therefore imply that many elderly individuals work, whether or not their health level permits it. Poor health may also prevent others from working, and thereby contribute to high poverty rates among the elderly.
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