Impact of work, social participation and retirement on health of older citizens in Europe

Abstract

In the first chapter of the thesis I studied effect of retirement on cognition among Europeans, using cross-country survey data from eleven European countries. I found that using the OLS regression the retirement is highly negatively correlated with the memory performance only for the male subsample. In addition, when I used the IV approach separately for subsamples of physically demanding and undemanding jobs, I found that the effect of the retirement on memory in both subsamples is negative. At the next step, I divided my sample into 2 groups of countries with high or low memory performance. This analysis led to the finding that in countries characterized by high memory performance the effect of the retirement on cognition is positive and highly significant. I interpreted this finding as the memory performance of retirees in high-memory level countries declines at slow rate. Although empirical studies find that participation in social activities positively affects health of older citizens in the Western societies, little attention so far was paid to the problem of potential endogenity. It is likely, however that healthier people are more able to participate in social activities or that both variables influence each other. Indeed, some authors acknowledge that the existing studies have not yet adequately answered this question. The second chapter of my thesis contributes to closing this gap. Using two waves of the Survey of Health Ageing and Retirement in Europe, I suggest that the measure of individual trust could serve as an instrument to isolate the causal path from participation in social activities to different levels of the reported self-perceived health. My findings confirm that trust causes the change in the health status of individuals through social activity participation. Socio-economic shocks, such as job loss due to layoffs or plant closure may lead to worse health because of the financial strain associated with these events. This could occur either because of stress or simply because the financial consequences make it hard to access health care. The third chapter of the thesis applies data from SHARELIFE to investigate the effect of involuntary job loss on health. My findings suggest that males have significant higher likelihood of reporting poor or fair health if they experienced layoff, whereas females are more likely to suffer from depression if they experienced a plant closure.