Health, Human Capital, and Life Cycle Labor Supply
American Economic Review
vol. 104,
no. 5, May 2014
(pp. 127-31)
Abstract
We use new PSID data on consumption and health, along with information on annual sick time, to estimate a structural labor supply model that incorporates a health capital stock with the traditional human capital learning-by-doing model. The estimates show strong evidence of learning by doing as well as strong persistence in health. However, the estimates reveal that time and money seem to have little effect on health consistent with "flat of the curve" medicine. We find strong evidence that consumption and leisure are direct substitutes in preferences, and consumption and leisure are each utility complements with good health.Citation
Hokayem, Charles, and James P. Ziliak. 2014. "Health, Human Capital, and Life Cycle Labor Supply." American Economic Review, 104 (5): 127-31. DOI: 10.1257/aer.104.5.127Additional Materials
JEL Classification
- D15 Intertemporal Household Choice; Life Cycle Models and Saving
- I12 Health Production
- J22 Time Allocation and Labor Supply
- J24 Human Capital; Skills; Occupational Choice; Labor Productivity