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Healthy people earn more

People with very good health can earn a wage 18% higher compared to those with poor or fair health according to a recent study from the Melbourne Institute of Applied Economic and Social Research at the University of Melbourne.

The study, by Dr Lixin Cai, a Research Fellow at the Melbourne Institute, used data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey to find these results.

“Health has a significant effect on wages,” said Dr Cai. “In fact, these results have backed up international data, showing that Australia is no different when it comes to health and wages.

“Wages are only one aspect of individuals’ economic wellbeing that can be affected by health. The effects on total economics wellbeing would be larger because a person’s labour force participation and working hours may also be affected by health, and economic wellbeing is derived from the combination of wages and labour supply,” said Dr Cai.

The working paper entitled ‘Effects of Health on Wages of Australian Men’ is available at www.melbourneinstitute.com

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