Working Paper: NBER ID: w21940
Authors: Courtney Coile; Kevin S. Milligan; David A. Wise
Abstract: Public programs that benefit older individuals, such as Social Security and Medicare, may be changed in the future in ways that reflect an expectation of longer work lives. But do older Americans have the health capacity to work longer? This paper explores this question by asking how much older individuals could work if they worked as much as those with the same mortality rate in the past or as much as their younger counterparts in similar health. Using both methods, we estimate that there is significant additional capacity to work at older ages. We also explore whether there are differences in health capacity across education groups and whether health has improved more over time for the highly educated, using education quartiles to surmount the challenge of changing levels of education over time.
Keywords: health capacity; older workers; employment; mortality; social security
JEL Codes: I19; J14; J26
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Improved health (I19) | Increased work capacity (E22) |
| Health comparisons with younger individuals (I14) | Additional work capacity for men aged 55-69 (J29) |
| Education level (I21) | Variations in work capacity (D29) |
| Employment-mortality relationships from 1977 to 2010 (J17) | Direct causal link between improved health and increased work capacity (I15) |