Orla Doyle () (Geary Institute, University College Dublin) Colm Harmon () (University College Dublin, CEPR and IZA Bonn) Ian Walker () (University of Warwick, Institute for Fiscal Studies and IZA Bonn)
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This paper investigates the robustness of recent findings on the effect of parental background on child health. We are particularly concerned with the extent to which their finding that income effects on child health are the result of spurious correlation rather than some causal mechanism. A similar argument can be made for the effect of education - if parental education and child health are correlated with some common unobservable (say, low parental time preference) then least squares estimates of the effect of parental education will be biased upwards. Moreover, it is very common for parental income data to be grouped, in which case income is measured with error and the coefficient on income will be biased towards zero and there are good reasons why the extent of bias may vary with child age. Fixed effect estimation is undermined by measurement error and here we adopt the traditional solution to both spurious correlation and measurement error and use an instrumental variables approach. Our results suggest that the income effects observed in the data are spurious.
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number
1832.
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Anne Case & Ingrid le Roux & Alicia Menendez, 2004.
"Medical Compliance and Income-Health Gradients,"
Working Papers
174, Princeton University, Woodrow Wilson School of Public and International Affairs, Research Program in Development Studies..
[Downloadable!]
Anne Case & Ingrid le Roux & Alicia Menendez, 2004.
"Medical Compliance and Income-Health Gradients,"
Working Papers
252, Princeton University, Woodrow Wilson School of Public and International Affairs, Center for Health and Wellbeing..
[Downloadable!]
Jonathan Meer & Douglas L. Miller & Harvey S. Rosen, 2003.
"Exploring the Health-Wealth Nexus,"
NBER Working Papers
9554, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
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