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When Money Matters More: Long‐Term Illness and the Income/Life Satisfaction Slope

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  • Leonardo Becchetti
  • Fabio Pisani

Abstract

We compare the life satisfaction of individuals aged above 50 years reporting or not reporting long‐term illnesses. Our econometric findings show that the positive income/life satisfaction gradient is steeper for individuals with at least one long‐term illness, especially those lacking private insurance or reporting above mean unmet medical needs. We also use the compensating variation approach and show that the marginal utility of income (net of the absolute and relative income effects) for the long‐term ill is significantly larger than the average marginal utility of income in the sample.

Suggested Citation

  • Leonardo Becchetti & Fabio Pisani, 2021. "When Money Matters More: Long‐Term Illness and the Income/Life Satisfaction Slope," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 67(3), pages 616-638, September.
    • Handle: RePEc:bla:revinw:v:67:y:2021:i:3:p:616-638
    DOI: 10.1111/roiw.12485
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