THE EFFECT OF CHRONIC DISEASE ON WORK BEHAVIOR OVER THE LIFE-CYCLE

Health status is a crucial determinant of work behavior. Approximately 14% of working age individuals report they have a health problem which restricts their activity. While the accumulated evidence clearly indicates that poor health has significant negative effects on labor force participation, these findings are limited because they do not consider the influence of chronic disease on work behavior over the life cycle. The purpose of this paper is to explore the effect of the onset of a chronic disease - arthritis - on work behavior over life cycle. The econometric technique used here - a dynamic hazard model - is the appropriate methodology to examine the health-work relationship over the life cycle because this approach estimates the pattern of labor force behavior after disease onset. Since the results indicate the duration of employment after disease onset, this study provides a complete picture of how poor health affects work behavior. The second section describes the data and assumptions employed in the empirical model. The econometric technique is outlined in section three. The specification of the empirical model is discussed in section four. The results are interpreted in section five. A concluding section summarizes the major findings. -from Author