| Abstract | This paper extends the labor supply model and job turnover model by introducing the health risks and medical insurance. Through the simulation of the theoretical model based on dynamic programming approach, this paper discusses the impact of health risk on labor supply decisions and job turnover decisions, as well as the role of medical insurance. The simulation shows that: the medical insurance decreases the labor supply of urban labor force, while it increases the labor supply of rural labor force, and the medical insurance increases the job mobility of urban labor force, while it decreases the job mobility of rural labor force. The empirical analysis using the data of CHNS finds that: Urban Employee Basic Medical Insurance(UEBMI) and Urban Resident Basic Medical Insurance(URBMI) decrease labor supply, while Cooperative Medical Insurance(CMI) increases labor supply, URBMI increases job mobility, while CMI decreases job mobility, and UEBMI increases the working hours of labor force, while CMI decreases the working hours of labor force. Concerning the sample heterogeneity, the research based on different age and different income subsamples does not change the basic conclusion, but there is a significant difference in the impact of medical insurance. Furthermore, robustness test by bivariate probit model and simultaneous equations model does not change the basic conclusion. |