Disability and Multi-State Labour Force Choices with State Dependence
Umut Oguzoglu ()
No 5408, IZA Discussion Papers from Institute of Labor Economics (IZA)
I use a dynamic mixed multinomial logit model with unobserved heterogeneity to study the impact of work limiting disabilities on disaggregated labour choices. The first seven waves of the Household Income and Labour Dynamics in Australia survey are used to investigate this relationship. Findings point out to strong state dependence in employment choices. Further, the impact of disability on employment outcomes is highly significant. Model simulations suggest that high cross and own state dependence can amplify a one-off disability shock to alter the probability of full time employment and nonparticipation permanently, especially for low skilled individuals.
Keywords: HILDA; panel data; dynamic mixed multinomial logit; employment; disability; simulated maximum likelihood (search for similar items in EconPapers)
JEL-codes: J14 J21 (search for similar items in EconPapers)
Pages: 37 pages
New Economics Papers: this item is included in nep-dcm and nep-lab
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Journal Article: Disability and Multi-State Labour Force Choices with State Dependence (2016)
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