Health Status and Labour Market Outcome: Empirical Evidence from Australia

39 Pages Posted: 9 Feb 2018

See all articles by Kannika Damrongplasit

Kannika Damrongplasit

Chulalongkorn University - Faculty of Economics

Cheng Hsiao

University of Southern California - Department of Economics; National Taiwan University; National Bureau of Economic Research (NBER)

Xueyan Zhao

Monash University

Multiple version iconThere are 2 versions of this paper

Date Written: January 16, 2018

Abstract

This paper uses eight waves of Australia Household, Income, and Labour Dynamics data (HILDA)to study the issues of state dependence and the short-run and long-run response to health shocks on labour market. We consider six alternative panel data binary dependent variable models with different ways of modeling labour market dynamics and individual heterogeneity. We find that the key results with regard to labour market dependence and the impacts of health shocks are sensitive to model specification and pooling of male and female samples with differences as large as six-folds. Specification analysis is conducted and favors the dynamic fixed-effects logit model for separate male and female samples. Methods for evaluating dynamic response paths to a one-time health shock for binary outcomes are also suggested and results presented.

Keywords: Health Status, Labour Force Participation, State Dependence, Dynamic Fixed-Effect Binary Logit Model

JEL Classification: I10, I12, J21, J24

Suggested Citation

Damrongplasit, Kannika and Hsiao, Cheng and Zhao, Xueyan, Health Status and Labour Market Outcome: Empirical Evidence from Australia (January 16, 2018). USC-INET Research Paper No. 18-03. Available at SSRN: https://ssrn.com/abstract=3112982 or http://dx.doi.org/10.2139/ssrn.3112982

Kannika Damrongplasit (Contact Author)

Chulalongkorn University - Faculty of Economics ( email )

Bangkok 10330
Thailand

Cheng Hsiao

University of Southern California - Department of Economics ( email )

3620 South Vermont Ave. Kaprielian (KAP) Hall, 300
Los Angeles, CA 90089
United States

National Taiwan University

1 Sec. 4, Roosevelt Road
Taipei, 106
Taiwan

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Xueyan Zhao

Monash University ( email )

23 Innovation Walk
Wellington Road
Clayton, Victoria 3800
Australia

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