Key Findings Details
The Dynamic Effects of Health on the Employment of Older Workers
Richard Blundell, Jack Britton, Monica Costa Dias and Eric French
- The dynamic properties of health are well described by the sum of a highly persistent AR(1) component, plus a transitory component.
- Transitory health shocks have little impact on employment.
- Permanent health shocks have much bigger effects on employment.
- Employment is highly persistent. Lagged employment strongly predicts current employment, even after accounting for the persistence in health.
- Model estimates suggest a larger impact of health on employment than what OLS estimates imply.