The effect of labelling on illness related absenteeism An economic explanation for the case of hypertension

What is the impact of being told that one has hypertension? According to evidence from randomized controlled trials one effect of labelling is an increase in illness related absenteeism among those who were unaware of their blood pressure status. Moreover, this effect exists even when no objective medical reasons justify such immediate increases in absenteeism. In this paper we present an economic explanation of this phenomenon based on the interpretation of absenteeism as a demand for days off work. In a two-period life cycle model, we show that a lower perceived probability of survival through the second period increases the demand for first-period leisure.