Dynamics of interactions between health and employment statuses: a panel data approach

Despite numerous sociological results, there is few econometric evidence on the links between health condition and job status. In addition, papers that analyze the links between health and job statuses make the assumption that dynamic interactions are identical over time whereas we may question the stability of these links during one’s professional life. In this paper, we use a non-parametric approach, the Kullback causality measure, to test for the stability of the interactions among time periods. Thus, our approach is more robust than the ones available and allows the determination of the effects of individual characteristics on interactions. Our dataset consists of a panel of 10,942 individuals observed from 1962 to 2006. We find significant reciprocal links between health condition, regardless of disease severity, and job status. However, job status does not affect both illness with a large disability index and illness with large risk of death. These findings confirm evidence from the literature. Finally, analyzing the dynamic of the interactions between job status health condition regardless of severity allows us to conclude that the impact of job status on health is not stable over time.