5.3 Determinants of labour force participation
This section presents the results of two models for explaining labour force participation based on the contribution of a range of variables. The first model is a pooled logit model, based on equation (1). Three specifications are presented, using different measures of health to explain the binary choice between participation and retirement: the presence of a chronic condition; SF12 summary measures of functional physical and mental health; and finally the self-rated general health rating. The pooled models do not attempt to control for issues mentioned previously such as unobserved omitted variables bias and reverse causality. They act, however, as a base model with which to compare further estimates. This is followed by the results for the correlated random effects model based on equation (5), which exploits the longitudinal aspect of the data. The key findings are summarised in the tables in this section, with complete results in Appendix C.
- All regressions are unweighted.