2005/10/17 by Lixin Cai, Guyonne Kalb · 1 citation
Health Professions · Social Sciences · #Employment and Welfare Studies #Global Health Care Issues #Retirement, Disability, and Employment
paper · doi:10.1002/hec.1053
openalex publication_date 2005/10/17 · openalex created_date 2025/10/10 · openalex updated_date 2026/08/04
This paper examines the effect of health on labour force participation using the Household, Income and Labour Dynamics in Australia (HILDA) Survey. The potential endogeneity of health, especially self-assessed health, in the labour force participation equation is addressed by estimating the health equation and the labour force participation equation simultaneously. Taking into account the correlation between the error terms in the two equations, the estimation is conducted separately for males aged 15-49, males aged 50-64, females aged 15-49 and females aged 50-60. The results indicate that better health increases the probability of labour force participation for all four groups. However, the effect is larger for the older groups and for women. As for the feedback effect, it is found that labour force participation has a significant positive impact on older females' health, and a significant negative effect on younger males' health. For younger females and older males, the impact of labour force participation on health is not significant. The null-hypothesis of exogeneity of health to labour force participation is rejected for all groups.