This dissertation answers three questions about the relationship between labor markets and health. In the first chapter, I examine the welfare effects of work restrictions in disability benefit programs. Work restrictions can discincentivize people with high work capability from applying and therefore control fiscal costs. However, they also distort the labor supply of claimants. I study a disability benefit program in the UK which does not feature work restrictions or means tests, and show that it is well-targeted by income and health and that marginal increases in generosity can be welfare-improving. I estimate a structural lifecycle model with endogenous benefit application, work, and asset accumulation decisions. I estimate this model using UK data and use it quantify the effect of benefit generosity and introduction of work restrictions on benefit claims, labor supply, and welfare. A revenue neutral doubling of benefit generosity generates a 24% increase in the benefit take up rate, while overall welfare is improved by the equivalent of 1.9% to 2.2% of lifetime consumption, depending on educational attainment. Introduction of work restrictions in my model reduces overall welfare by 1.6% to 1.3% of lifetime consumption, depending on educational attainment. The second chapter estimates the causal effect of work-related autonomy on mental health. Using Understanding Society data from the UK, I exploit within-person, within-occupation variation in autonomy and explore the robustness of my results to assumptions about the degree of confoundedness of unobservables. I find low work-related autonomy adversely impacts mental health. Finally, I investigate heterogeneity across occupational characteristics in the effect of retirement eligibility on mental health in the UK. I use K-means clustering to define three occupational clusters, differing across multiple dimensions. I estimate the effect of retirement eligibility using a Regression Discontinuity Design, allowing the effect to differ by cluster. The effects of retirement eligibility are beneficial, and greater in two clusters: one comprised of white-collar jobs in an office setting and another of blue-collar jobs with high physical demands and hazards. The cluster with smaller benefits mixes blue- and white-collar uncompetitive jobs with high levels of customer interaction.
