Labor Economics Commons^™

Essays On Health And Labor Market Outcomes, Maryam Jafari Bidgoli

Wayne State University Dissertations

This dissertation examines the relationship between health and labor market outcomes using the 1996-2010 longitudinal RAND Health and Retirement Study (HRS). First, it estimates the relationship between health and labor supply using a simultaneous equation model, treating health as endogenous. The effect of health may be overestimated because people may adjust their non-employment status by their health conditions (justification hypothesis). By using a full information maximum likelihood method, we can conduct a true test of exogeneity on the health variable, taking into account the correlation between two labor supply and health equations’ time-varying error components (unobserved heterogeneity). The results confirm …