Further Evidence on the Economic Effects of Poor Health

Abstract

This paper examines variations in current economic welfare attributable to different profiles or histories of health status over the preceding ten year period. A two-equation model, estimated with National Longitudinal Survey data for four sex-race groups, provides convincing evidence that health problems incurred in the past adversely affect current earnings. This legacy is difficult to overcome; it remains even for individuals in improving health willing to devote relatively greater effort to market work. A history of poor health is also shown to exact substantially different economic tolls from men and women as well as from whites and blacks.