Work and health after retirement: a competing risks model with semiparametric unobserved heterogeneity

Competing risks models recognize that there may be more than one exit from a given state, but they make the strong assumption that there is no correlation between unobserved heterogeneity components in each state. Here, a competing risks model which uses a semiparametric method of estimation and controls for the correlation between unobserved heterogeneity components in each state is compared with a traditional competing risks model of exit from retirement. The unobservable heterogeneity components of our competing risks are insignificantlypositively correlated and the effects of policy-relevant variables are changed somewhat.