Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/21500 
Year of Publication: 
2002
Series/Report no.: 
IZA Discussion Papers No. 457
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
This paper aims to explore the interrelation between health and work decisions of elderly workers, taking the various ways in which health and work can influence each other explicitly into account. For this, two issues are of relevance. Self-assessed health measures are usually at hand in empirical analyses and research indicates that these may be endogenous, state dependent, reporting behaviour. Furthermore, even if an objective health measure is used, it is not likely to be strictly exogenous to labour market status or labour income. Health and labour market variables are correlated because of unobserved individual-specific characteristics (e.g., investments in human capital and health capital) Moreover, one?s labour market status is expected to have a (reverse) causal effect on health. A solution to the ?Health and Retirement Nexus? requires an integrated model for work decisions, health production and health reporting mechanisms. We formulate such a model and estimate it on a longitudinal dataset of Dutch elderly.
Subjects: 
Retirement
health
endogeneity
state dependent reporting errors
JEL: 
J14
I12
Document Type: 
Working Paper

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