The Roles of Objective and Subjective Health Measures on Elderly Labor Supply Decisions

Abstract

The U.S. elderly labor force participation rates (LFPR) has been increasing during the last two decades. Using the Michigan Health and Retirement Study (HRS) survey, this paper analyzes the e ects of subjective and various objective health measures on elderly labor force participation decisions in the U.S. over the time period 2002-2012. The results were obtained for two age groups: 50-61 (where almost no one is eligible for Social Security (SS) and pensions) and 70-81 (where almost everyone is covered by SS and/or pensions). The empirical ndings suggest that elderly Americans drop out of the labor force only if they subjectively rate their health as poor.