Winnie Adhiambo , University of Nairobi
Although extensive empirical literature exists on the labour supply effects of general poor health or single conditions from the perspective of developed countries, the literature in a Kenyan perspective is scarce. This paper contributes to the understanding of this issue by using the most recent 2015/2016 Kenya Integrated Household Budget Survey (KIHIBS) data and by examining and comparing the labour force participation outcomes for different types of acute diseases. The analysis also take into consideration the endogeneity of the health variable in explaining labour force participation among the working age population. The estimation is done through an Instrumental Variable (IV) approach. The estimation is conducted separately for males and females. The results indicate that poor health reduces the probability of labour force participation across all five disease groups and regional differences are also observed. The North Eastern and Western regions of Kenya recorded the highest effect. The results further suggests that the propensity to participate in the labour market is significantly lowered as a result of poor health for men in all the disease groups. Only respiratory infections significantly reduce labour market activity among working age females. However, endogeneity is rejected for all the individual acute illnesses under review. The findings from the study suggest that specific illnesses are important in explaining the economic burden and since the effect on labour force participation varies with the disease type, targeted interventions would go a long way in reducing this burden.
Presented in Session P3. Poster Session Migration, Economics, Environment, Methods, History and Policy