Elderly Health and Salaries in the Mexican Labor Market

The main purpose of this paper is to investigate the determinants of elderly health in the context of Mexico as a developing country and the relationship between health indicators and earnings in the labor market. The authors analyze the determinants of elderly health in Mexico, considering a number of different measures of health status, and use these indicators to evaluate the impact of health on the income of working elderly individuals. The results find that health measures have a strong negative effect on wages for male elderly workers. The lowest point estimations demonstrate that poor health lowers hourly earnings by 58 percent. These are sizable effects, particularly within the context of a developing country, which does not have a universal social security system. Poor health may also prevent others from working, and thereby contribute to high poverty rates among the elderly.