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Job market paper

Too Stressed to Work: The Effects of Job Stressors on Health and Employment Dynamics

In this paper, I examine the effects of several psychological stressors including perceived job stress, job demand, job control, and job security on mental and physical health outcomes. Individual perceptions of job stressors are captured using eleven years of self-reported data from the House, Income, and Labour Dynamics in Australia (HILDA) survey. I jointly estimate a set of correlated dynamic equations representing several employment behaviors at the extensive and intensive margins, job stressors, mental and physical health outcomes, that account for job selection, for endogeneity of job stressors and for dynamic relationships among work, stressors and health. The results confirm that subjective job stressors causally impact health, with the effects being stronger for mental health. In addition, I find the effects of job-related stressors to be stronger for females than males. Interestingly, corrections for selection and endogeneity bias suggest that these biases led to underestimates of the true stressor impacts for females and overestimates for males.