Health and Inequality

Tinbergen Institute Discussion Paper 13-170/V

146 Pages Posted: 16 Oct 2013

See all articles by Owen A. O'Donnell

Owen A. O'Donnell

University of Macedonia

Eddy van Doorslaer

Erasmus School of Economics

Tom Van Ourti

Erasmus University Rotterdam (EUR); Tinbergen Institute

Date Written: October 15, 2013

Abstract

We examine the relationship between income and health with the purpose of establishing the extent to which the distribution of health in a population contributes to income inequality and is itself a product of that inequality. The evidence supports a significant and substantial impact of ill-health on income mainly operating through employment, although it is difficult to gauge the magnitude of the contribution this makes to income inequality. Variation in exposure to health risks early in life is a potentially important mechanism through which health may generate, and possibly sustain, economic inequality. If material advantage can be exercised within the domain of health, then economic inequality will generate health inequality. In high income countries, the evidence that income (wealth) does have a causal impact on health in adulthood is weak. But this may simply reflect the difficulty of identifying a relationship that, should it exist, is likely to emerge over the lifetime as poor material living conditions slowly take their toll on health. There is little credible evidence to support the claim that the economic inequality in society threatens the health of all its members, or that relative income is a determinant of health.

Keywords: income, wealth, health, inequality

JEL Classification: D31, I14, J3

Suggested Citation

O'Donnell, Owen A. and van Doorslaer, Eddy and Van Ourti, Tom, Health and Inequality (October 15, 2013). Tinbergen Institute Discussion Paper 13-170/V, Available at SSRN: https://ssrn.com/abstract=2340545 or http://dx.doi.org/10.2139/ssrn.2340545

Owen A. O'Donnell (Contact Author)

University of Macedonia ( email )

156 Egnatia St.
P.O. 1591
Thessaloniki, 54006
Greece

Eddy Van Doorslaer

Erasmus School of Economics ( email )

Netherlands

Tom Van Ourti

Erasmus University Rotterdam (EUR) ( email )

Burgemeester Oudlaan 50
3000 DR Rotterdam, Zuid-Holland 3062PA
Netherlands

Tinbergen Institute ( email )

Burg. Oudlaan 50
Rotterdam, 3062 PA
Netherlands

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