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Income Inequality and Individual Health: Exploring the Association in a Developing Country

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  • Nilsson, Therese

    ()
    (Department of Economics)

  • Bergh, Andreas

    ()
    (Research Institute of Industrial Economics (IFN))

Abstract

We use individual and multi-level data from Zambia on child nutritional health to test the absolute income hypothesis (AIH), the relative income hypothesis (RIH) and the income inequality hypothesis (IIH). The results confirm a non-linear positive relation between economic resources and health, confirming the AIH. For the RIH we find sensitivity to what reference group is used. Most interestingly, while the IIH predicts that income inequality, independent from individual income, will affect health negatively, we find higher income inequality to robustly associate with better child health. The results suggest that the relationship between inequality and health in developing contexts might be very different from the predominant view in the existing literature mainly based on developed countries, and that alternative mechanisms might mediate the relationship in poor countries.

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Bibliographic Info

Paper provided by Research Institute of Industrial Economics in its series Working Paper Series with number 899.

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Length: 31 pages
Date of creation: 20 Jan 2012
Date of revision:
Handle: RePEc:hhs:iuiwop:0899

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Keywords: Health; Economic inequality; Zambia;

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  1. Ulf-G. Gerdtham & Magnus Johannesson, 2004. "Absolute Income, Relative Income, Income Inequality, and Mortality," Journal of Human Resources, University of Wisconsin Press, vol. 39(1).
  2. Andrew Leigh & Christopher Jencks, 2006. "Inequality and Mortality: Long-Run Evidence from a Panel of Countries," CEPR Discussion Papers 533, Centre for Economic Policy Research, Research School of Economics, Australian National University.
  3. Ettner, Susan L., 1996. "New evidence on the relationship between income and health," Journal of Health Economics, Elsevier, vol. 15(1), pages 67-85, February.
  4. Douglas Miller & Christina Paxson, 2001. "Relative Income, Race, and Mortality," Working Papers 269, Princeton University, Woodrow Wilson School of Public and International Affairs, Center for Health and Wellbeing..
  5. Behrman, Jere R., 1988. "Nutrition, health, birth order and seasonality : Intrahousehold allocation among children in rural India," Journal of Development Economics, Elsevier, vol. 28(1), pages 43-62, February.
  6. Karlsson, Martin & Nilsson, Therese & Lyttkens, Carl Hampus & Leeson, George, 2010. "Income inequality and health: Importance of a cross-country perspective," Social Science & Medicine, Elsevier, vol. 70(6), pages 875-885, March.
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