Health is distributed unequally by occupation. Workers on a lower rung of the occupational ladder report worse health, have a higher probability of disability and die earlier than workers higher up the occupational hierarchy. Using a theoretical framework that unveils some of the potential mechanisms underlying these disparities, three core insights emerge: (i) there is selection into occupation on the basis of initial wealth, education, and health, (ii) there will be behavioural responses to adverse working conditions, which can have compensating or reinforcing effects on health, and (iii) workplace conditions increase health inequalities if workers with initially low socioeconomic status choose harmful occupations and don’t offset detrimental health effects. We provide empirical illustrations of these insights using data for the Netherlands and assess the evidence available in the economics literature.
Higher cost sharing for seriously ill and low-income patients could discourage treatment of vulnerable populations and create substantial downstream costs.
Health is well known to show a clear gradient by occupation. While it may appear evident that occupation can affect health, there are multiple possible sources of selection that can generate a strong association, other than simply a causal effect of occupation on health. We link job characteristics to German panel data spanning 29 years to characterize occupations by their physical and psychosocial burden. Employing a dynamic model to control for factors that simultaneously affect health and selection into occupation, we find that selection into occupation accounts for at least 60 percent of the association. The effects of occupational characteristics such as physical strain and low job control are negative and increase with age: late-career exposure to one year of high physical strain and low job control is comparable to the average health decline from ageing 16 and 6 months, respectively.
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