Health, Health Insurance and Retirement Expectations Pubblico

Abstract

This study of retirement decisions combines the previous literature and methods to estimate the joint effects of health and health insurance on individuals' retirement plans and expectations. It also examines how spouse's health and health insurance influences one's retirement plans. Using two unique variables from the Health and Retirement Study - the planned retirement age and the probability of working full-time after the age of 62 - the results were estimated both cross-sectionally and longitudinally. The results show that those who lack any early-retirement health insurance options are affected more than others by health in their retirement planning. Generally, these individuals are more likely to retire earlier only if their health worsens, while those who retain health insurance upon an early retirement tend to retire earlier regardless of the state of their health. A spouse's health does not affect retirement plans by a large amount, but some results suggest that an individual with a very sick spouse may plan to retire early -- a possible evidence of care giving. Finally, this study also sheds light on why past studies reported conflicting results. It finds that the relationship between health and retirement plans may not be linear, but rather quadratic where individuals are more likely to retire early only after health worsens to a certain level.

Table of Contents

1 INTRODUCTION 1

2 BACKGROUND 3
2.1 Health of Older Workers ............................ 3
2.2 Job Lock.................................................. 4
2.3 Health Insurance and Related Legislation....... 5

3 LITERATURE REVIEW 6
3.1 Health and Retirement .............................. 6
3.2 Health Insurance and Retirement................. 8
3.3 Partner's Health and Retirement ................. 9
3.4 Potential Problems and Biases .................... 9

4 CONCEPTUAL FRAMEWORK 11

5 DATA 14
5.1 Data Processing....................................... 14

5.2 Dependent Variables ................................ 16

5.3 Health Variables....................................... 18

5.4 Health Insurance ..................................... 22

5.5 Control Variables ..................................... 24

6 MODEL 27
6.1 First Step: Latent Variable Estimation .......... 27
6.2 Second Step: Pooled Model and Fixed Effects Estimation ... 29

6.3 Identification: Addressing Potential Biases.... 30

7 RESULTS 31
7.1 First Step Estimation ................................ 31
7.2 Pooled Model........................................... 35

7.2.1 Planned Retirement Age ......................... 36

7.2.2 Probability of Working Full-time Past the Age of 62 ... 42
7.3 Fixed Effects Estimation ............................ 48

7.3.1 Planned Retirement Age ......................... 48

7.3.2 Probability of Working Full-time Past the Age of 62 ... 55

8 CONCLUSION 62

APPENDIX 69

About this Master's Thesis

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• Permission granted by the author to include this thesis or dissertation in this repository. All rights reserved by the author. Please contact the author for information regarding the reproduction and use of this thesis or dissertation.

School	Laney Graduate School
Department	Economics
Degree	MA
Submission	Master's Thesis
Language	English
Research Field	Economics, Labor Economics, General
Parola chiave	Economics Retirement Health Health Insurance
Committee Chair / Thesis Advisor	Frisvold, David, Emory University
Committee Members	Markowitz, Sara, Emory University Francis, Andrew, Emory University

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