The effect of health on labour supply in nine former Soviet Union countries

Abstract

This paper examines for the first time the consequences of ill health on labour supply for a sample of nine countries from the former Soviet Union (FSU), using a unique multicountry household survey specifically designed for this region. We control for a wide range of individual, household, and community factors, using both standard regression techniques and instrumental variable estimation to address potential endogeneity. Specifically, we find in our baseline ordinary least squares specification that poor health is associated with a decrease in the probability of working of about 13 %. Controlling for community-level unobserved variables slightly increases the magnitude of this effect, to about 14 %. Controlling for endogeneity with the instrumental variable approach further supports this finding, with the magnitude of the effect ranging from 12 to 35 %. Taken together, our findings confirm the cost that the still considerable adult health burden in the FSU is imposing on its population, not only in terms of the disease burden itself, but also in terms of individuals' labour market participation, as well as potentially in terms of increased poverty risk. Other things being equal, this would increase the expected "return on investment" to be had from interventions aimed at improving health in this region.

The impact of poor adult health on labor supply in the Russian Federation

“…Thus, using RLMS survey data collected in 1997–2004, Abegunde et al [9] found a significant positive association between a combined dummy for non-chronic diseases and the probability of missing days of work for heads of households. A study using data collected in ten post-Soviet countries [24], including Russia, found that poor health was associated with a 15 % lower probability of work in the community fixed-effects specification, which is comparable to the result we found in the OLS model (i.e., about 14 % lower probability of work). Finally, Suhrcke et al [4] found that in Russia, self-assessed good health was mostly unrelated to log of hours worked per week.…”

“…Nevertheless, the magnitude of the difference is quite unexpected for most age groups. One potential reason for this is that women may feel more responsible for their families and thus continue working despite being in poor health [22–24]. …”

Determinants and impact of role-related time use allocation on self-reported health among married men and women: a cross-national comparative study

“…The responses ranged from zero (poor) to three (very good). From this we created a binary variable "good heath", with individuals reporting "good" or "very good" health being accorded a "1″, and those reporting "poor" or "fair health" a "0″, as done in other studies [34].…”

Health inequality and the uses of time for workers in Europe: policy implications

“…Following Goryakin et al (2014) as an alternative analysis, we create the 'good health' variable that takes value '1' if individuals reported 'good' or 'very good' health, and value '0' when individuals report 'poor' and 'fair' health, and we include this dummy variable in Eqs. (1) to (5) as a measure of self-reported health.…”