Exploring the health–wealth nexus

The causal links between health and economic resources have long concerned social scientists. We use four waves of data from the Panel Study of Income Dynamics (PSID) to analyze the impact of wealth upon an individual’s health status. The difficulty in approaching this task that has bedeviled previo...

Full description

Saved in:
Bibliographic Details
Published inJournal of health economics Vol. 22; no. 5; pp. 713 - 730
Main Authors Meer, Jonathan, Miller, Douglas L, Rosen, Harvey S
Format Journal Article
LanguageEnglish
Published Netherlands Elsevier B.V 01.09.2003
Elsevier
Elsevier Sequoia S.A
SeriesJournal of Health Economics
Subjects
Access to health care
Causality
Economic resources
Economics
Family Characteristics
Geography
Health
Health administration
Health inequality
Health Status Indicators
Humans
Income
Income - classification
Income - statistics & numerical data
Inheritances
Instrumental variable estimation
Models, Econometric
Panel Study of Income Dynamics (PSID)
Poverty
Regression analysis
Self Concept
Social Change
Socioeconomic factors
Socioeconomic status
Studies
Time Factors
United States
Wealth
Wills - economics
United States
United States > US
I1
Health
Panel Study of Income Dynamics (PSID)
Wealth
Online AccessGet full text

Cover

More Information
Summary:The causal links between health and economic resources have long concerned social scientists. We use four waves of data from the Panel Study of Income Dynamics (PSID) to analyze the impact of wealth upon an individual’s health status. The difficulty in approaching this task that has bedeviled previous studies is that wealth may be endogenous; a priori, it is just as likely that changes in health affect wealth as vice versa. We argue that inheritance is a suitable instrument for the change in wealth, and implement a straightforward instrumental variables strategy to deal with this problem. Our results suggest that the causal relationship running from wealth to health may not be as strong as first appears. In the data, wealth exerts a positive and statistically significant effect on health status, but it is very small in magnitude. Instrumental variables estimation leaves the point estimate approximately the same, but renders it insignificantly different from zero. And even when the point estimate is increased by twice its standard error (S.E.), the quantitative effect is small. We conclude that the wealth-health connection is not driven by short run changes in wealth.
Bibliography:ObjectType-Article-2
SourceType-Scholarly Journals-1
ObjectType-Feature-1
content type line 23
ObjectType-Article-1
ObjectType-Feature-2
ISSN:0167-6296
1879-1646
DOI:10.1016/S0167-6296(03)00059-6