Subjective health measures and state dependent reporting errors

Abstract

The use of subjective health measures in empirical models of labour supply and retirement decisions has frequently been criticized. Responses to questions concerning health may be biased due to financial incentives and the willingness to conform to social rules. The eligibility conditions for some social security allowances, notably Disability Insurance benefits, are contingent upon bad health. Even if the decision to apply for a disability allowance is to some extent motivated by financial considerations or a relatively strong preference for leisure, respondents will be inclined to play down these motives and emphasize the importance of their health condition. As a consequence, reporting errors may depend on the labour market status of the respondent and self-reported health variables will be endogenous in labour supply and retirement models. The objective of this paper is to assess the importance of state dependent reporting errors in survey responses and to propose and estimate a model that can be used to account for this kind of systematic mis-reporting. The estimation results indicate that among respondents receiving Disability Allowance, reporting errors are large and systematic. Using such subjective health measures in retirement models may therefore seriously bias the parameter estimates and the conclusions drawn from these.

I feel good! Gender differences and reporting heterogeneity in self-assessed health

“…To cover nonlinear age effects, we group males and females into age quintiles. 5 The lowest quintile is set up by those individuals aged equal to or less than 38 years for males and 36 years for females. The highest quintile contains respondents older than 68 or 67 years, respectively.…”

“…The latter information is more related to sickness than the self-reported health but still a subjective measure. According to Kerkhofs and Lindeboom [5], we try to objectify this illness reporting. To construct our disease index, we make use of the binary variable "health problems"…”

“…Kerkhofs and Lindeboom [5] analyse labour supply and retirement decisions and the influence of subjective health measures. A reporting error of the health measure may depend on the labour market status and self-reported health can be viewed as endogenous in labour supply and retirement models.…”

Age related health dynamics and changes in labour market status

“…5 It is argued that responses concerning health may depend upon labour market status, due to economic incentives or that responses are adapted to conform to social norms. These biases may consequently seriously distort parameter estimates in behavioural models for the relationship between labour market status and health.…”

Assessing Health Endowment, Access and Choice Determinants: Impact on Retired Europeans’ (In)activity and Quality of Life

“…Self-assessed general health measures, most commonly used, are subjective, and may come biased by heterogeneity of perspectives or personality, which reflect different reference levels against which individuals possibly in the same state of health judge their health and categorize it in an ordinal response. Their comparability across groups of individuals, with different norms and expectations, has been questioned in a number of studies (Kerkhofs and Lindeboom 1995;Groot 2000;Sen 2002;Lindeboom and Van Doorslaer 2004;Jurges 2007). For instance, a common finding is that older respondents tend to have a 'milder' view of their health, i.e.…”