The role of self-reporting bias in health, mental health and labor force participation: a descriptive analysis

Previous research on male subjects has conjectured that subjective selfreports of health status may lead to an upward bias in the estimated effect of health on labor force participation because subjects who are out of the labor force may be more likely to understate their health status so as to justify their lack of employment. In the descriptive analysis conducted in this article, we compare the effects of mental and physical health status on labor force participation, employing propensity score methods to investigate whether these effects differ for selfand proxy respondents. The authors initially find some evidence that seems to suggest systematic differences between proxy and self-reporters in the effects of health on labor force participation, raising the possibility that self-reporters may be biased in their health assessments. After we control for objective baseline indices of mental and physical health status, however, differences between subjective health assessments and labor force participation become smaller and statistically insignificant. These results suggest that selfreports do not lead to overestimates of the importance of good physical or mental health on labor force participation, after one controls for objective health conditions in the models. Although we conclude that propensity score matching is a useful way J. Leroux Institute of Applied Economics, HEC Montréal, CIRANO and CIRPEE, Montreal, QC, Canada J. A. Rizzo Department of Economics, Stony Brook University, Stony Brook, NY, USA J. A. Rizzo Department of Preventive Medicine, Stony Brook University, Stony Brook, NY, USA R. Sickles (B) Department of Economics, Rice University, Houston, TX, USA e-mail: [email protected]