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Health Capital and Human Capital as Explanations for Health-Related Wage Disparities

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  • Donna Gilleskie
  • Denise Hoffman

Abstract

We use a dynamic modeling strategy to evaluate two potential avenues through which health differences generate a wage gap: directly through reductions in health capital and indirectly through employment transitions that reduce human capital (specifically, occupation and employer tenure). Our results suggest that male workers with a moderate disability are 23 percent more likely to change occupations or employers than nondisabled men. Compared to those who do not make a transition, workers with a moderate disability who change occupations and employers experience an immediate $0.30 decline in hourly wages on top of a $0.57 decline associated with the disability onset.

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  • Donna Gilleskie & Denise Hoffman, 2014. "Health Capital and Human Capital as Explanations for Health-Related Wage Disparities," Journal of Human Capital, University of Chicago Press, vol. 8(3), pages 235-279.
    • Handle: RePEc:ucp:jhucap:doi:10.1086/677855
    DOI: 10.1086/677855
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    1. Marjorie L. Baldwin & Edward J. Schumacher, "undated". "Job Mobility among Workers with Disabilities," Working Papers 9805, East Carolina University, Department of Economics.
    2. Hugo Benítez-Silva & Moshe Buchinsky & Hiu Man Chan & Sofia Cheidvasser & John Rust, 2004. "How large is the bias in self-reported disability?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 19(6), pages 649-670.
    3. Gloria J. Bazzoli, 1985. "The Early Retirement Decision: New Empirical Evidence on the Influence of Health," Journal of Human Resources, University of Wisconsin Press, vol. 20(2), pages 214-234.
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    5. Marjorie Baldwin & William G. Johnson, 1994. "Labor Market Discrimination against Men with Disabilities," Journal of Human Resources, University of Wisconsin Press, vol. 29(1), pages 1-19.
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    Cited by:

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    2. Marcela Parada-Contzen, 2020. "Crowding-out in savings decisions, portfolio default adoption and home ownership: evidence from the Chilean retirement system," Review of Economics of the Household, Springer, vol. 18(2), pages 543-569, June.
    3. Duryea, Suzanne & Martínez, Claudia & Smith, Raimundo, 2024. "Disability Employment Quotas: Effects of Laws and Nudges," IDB Publications (Working Papers) 13375, Inter-American Development Bank.
    4. Donna B. Gilleskie, 2021. "In sickness and in health, until death do us part: A case for theory," Southern Economic Journal, John Wiley & Sons, vol. 87(3), pages 753-768, January.
    5. Souvik Banerjee & Anirban Basu, 2021. "Estimating Endogenous Treatment Effects Using Latent Factor Models with and without Instrumental Variables," Econometrics, MDPI, vol. 9(1), pages 1-25, March.
    6. SAM, Vichet, 2019. "Access to Formal Credit and Gender Income Gap: The Case of Farmers in Cambodia," MPRA Paper 97052, University Library of Munich, Germany.

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