The joint effect of health shocks and eligibility for social security on labor supply

The impact of health on labour market outcomes: A rapid systematic review

The relationship between an individual's health and their labour market outcomes has long been a subject of health economics research. This review aims to provide an up-to-date, global review of the substantive findings in the existing literature. We pay particular attention to causal effects, acknowledging the methodological complexities that have long challenged the research and emphasizing the importance of overcoming them to present robust, policy-relevant evidence. The recent literature shows a notable advancement in addressing these methodological issues compared to previous work. The evidence reviewed suggests that individuals with better health overwhelmingly exhibit higher earnings and often enhanced labour supply. These findings extend beyond geographical boundaries, as evidence from diverse regions underscores the global significance of this association. The review covers evidence from a wide range of health indicators and conditions - including e.g. self-reported health, chronic diseases, disability, nutritional health, infections, mental health, addictions and others. Within and across the different health domains, the health-related factors exert varying degrees of influence on labour market outcomes, highlighting the multifaceted nature of the health-labour relationship and its potentially profound implications for individuals, communities, and economies.

A systematic review and meta-analysis on the effects of ill health and health shocks on labour supply

BACKGROUND

Several studies have explored the effects of ill health and health shocks on labour supply. However, there are very few systematic reviews and meta-analyses in this area. The current work aims to fill this gap by undertaking a systematic review and meta-analysis on the effects of ill health and health shocks on labour supply.

METHODS

We searched using EconLit and MEDLINE databases along with grey literature to identify relevant papers for the analysis. Necessary information was extracted from the papers using an extraction tool. We calculated partial correlations to determine effect sizes and estimated the overall effect sizes by using the random effects model. Sub-group analyses were conducted based on geography, publication year and model type to assess the sources of heterogeneity. Model type entailed distinguishing articles that used the standard ordinary least squares (OLS) technique from those that used other estimation techniques such as quasi-experimental methods, including propensity score matching and difference-in-differences methodologies. Multivariate and univariate meta-regressions were employed to further examine the sources of heterogeneity. Moreover, we tested for publication bias by using a funnel plot, Begg's test and the trim and fill methodology.

RESULTS

We found a negative and statistically significant pooled estimate of the effect of ill health and health shocks on labour supply (partial r = -0.05, p < .001). The studies exhibited substantial heterogeneity. Sample size, geography, model type and publication year were found to be significant sources of heterogeneity. The funnel plot, and the trim and fill methodology, when imputed on the left showed some level of publication bias, but this was contrasted by both the Begg's test, and the trim and fill methodology when imputed on the right.

CONCLUSION

The study examined the effects of ill health and health shocks on labour supply. We found negative statistically significant pooled estimates pertaining to the overall effect of ill health and health shocks on labour supply including in sub-groups. Empirical studies on the effects of ill- health and health shocks on labour supply have oftentimes found a negative relationship. Our meta-analysis results, which used a large, combined sample size, seem to reliably confirm the finding.

The impact of environmental pollution on labor supply: empirical evidence from China

The current study focuses on determining mediating effect using the fixed and instrumental variable models to understand how PM_2.5 affects labor supply. To approach study objectives, a 20-year dataset (from 2000 to 2019) of 287 Chinese prefecture-level cities were collected. To deal with potential endogeneity, the ventilation coefficient was used as an instrumental variable to identify the reverse causality between PM_2.5 and labor supply. Results depicted that the PM_2.5 pollution significantly and negatively impacts the labor supply. It was found that PM_2.5 indirectly reduced labor forces because of pollution-induced health losses. Moreover, when the pollution level was above 30 μg/m³, the PM_2.5 significantly reduced the labor supply. The result suggests that China's local and national governments should enact stringent policy measures to reduce air pollution.