This twice-revised FIRST application aims to provide detailed quantitative evidence on how health insurance affects labor market outcomes. It will assess the impact of health insurance on three different aspects of individual behavior: 1) retirement, 2) job turnover, and 3) unemployment. Data from the HRS and the SIPP will be used to estimate the extent to which the availability of different types of health insurance affects each of these outcomes, and whether these effects vary with factors that reflect how much individuals value health insurance. The application will examine how employer provision of health insurance has affected job characteristics and the structure of employment in the labor market. The application first develops a framework for considering the effect of rising health insurance costs on labor market outcomes. Using individual, industry and firm-level data, it then aims to empirically test the implications that are derived from this framework. These predictions include an increase in the number of hours worked by those with employer-provided health insurance, a decrease in the employment of workers who are provided with employment-based health insurance, and an increase in the employment of workers without employer-provided health insurance, particularly part-time and contingent workers.
| Carroll, Gabriel D; Choi, James J; Laibson, David et al. (2009) Optimal Defaults and Active Decisions. Q J Econ 124:1639-1674 |
