Does Working for Oneself, Not Others, Improve Older Adults' Health? An Investigation on Health Impact of Self-Employment

American Journal of Entrepreneurship, Volume 7(1), pp. 142-180, 2014

Posted: 22 Oct 2014

See all articles by Ting Zhang

Ting Zhang

University of Baltimore

Dawn Carr

Stanford University

Date Written: October 20, 2014

Abstract

This paper examines the health impact of being self-employed versus working for others among older adults (aged 50 ) and its implications. Facing an aging workforce, self-employment at older ages may provide an economic benefit via an alternative to retirement. However, little research has examined the health effects of self-employment in later life. Relying on the latest 7 waves of data from the Health and Retirement Study, this study comprehensively examines health using a 29-item index to measure the impact of self-employment status on changes in older adults' overall health. We conduct a 2-stage generalized panel data instrument variables regression model, with lagged values to control potential endogeneity and simultaneity issues. We find self-employment compared to wage-and-salary jobs result in better health, controlling for job stress and work intensity, cognitive performance, prior health conditions, socioeconomic and demographic factors. This positive self-employment impact stands out in knowledge-based industry sectors. In labor intensive industry sectors such as Durable Goods Manufacturing, self-employed older adults' more gradual retirement seems to result in a health advantage over wage-and-salary employees. Limitations of the study and future research directions are discussed.

Suggested Citation

Zhang, Ting and Carr, Dawn, Does Working for Oneself, Not Others, Improve Older Adults' Health? An Investigation on Health Impact of Self-Employment (October 20, 2014). American Journal of Entrepreneurship, Volume 7(1), pp. 142-180, 2014, Available at SSRN: https://ssrn.com/abstract=2512600

Ting Zhang (Contact Author)

University of Baltimore ( email )

1420 N. Charles St.
Baltimore, MD 21201-5779
United States

HOME PAGE: http://https://sites.google.com/site/tzhangphd/,

Dawn Carr

Stanford University ( email )

Stanford, CA 94305
United States

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