Labour Supply, Health and Caring - Evidence from the UK

This paper investigates the impact of own-health,and that of others, on individual labour supply. We estimate a model of hours of caring and hours of work using a large micro dataset of UK households. We find that own ill health has a negative effect on wages for men but not women; being a carer has a negative effect on wages for women but not men; and that unobservables associated with caring are positively correlated with wages for men but not for women. We also find that own ill health has a strong negative effect on the labour supply of both men and women and a negative effect on their supply of caring. We also find that hours caring are responsive to wages for women.