Two separated effects of employer-provided health insurance on job mobility
We estimate the effect of employer-provided health insurance (EPHI) on job mobility via a dynamic model of joint employment and health insurance decision in the presence of uncertainty about wage rate and health status transitions. The model is based on a Markov decision process in
which a hedonic wage approach provides an economic rationale for the different choices and health insurance serves as an input to the health production process. Including health transitions in the model helps us to understand how the availability of EPHI (positive job characteristic) and holding
EPHI (the wage-health insurance trade-off) enter into the individuals’ decisions. The model is estimated using the 1999–2000 Medical Expenditure Panel Survey panel 4, and the results show that the ‘pure’ effects of holding EPHI are negligible, the ‘full’
effects of EPHI are significant and the degrees of the inefficiency vary between 14% and 25% across different states.
Keywords: I10; J21; J24; employer-provided health insurance; endogenous selection; health dynamics; job mobility; labour market efficiency
Document Type: Research Article
Affiliations: Hanqing Advanced Institute of Economics and Finance, Renmin University of China, Beijing, 100872, P.R. China
Publication date: 02 October 2014
- Editorial Board
- Information for Authors
- Subscribe to this Title
- Ingenta Connect is not responsible for the content or availability of external websites
- Access Key
- Free content
- Partial Free content
- New content
- Open access content
- Partial Open access content
- Subscribed content
- Partial Subscribed content
- Free trial content