IDEAS home Printed from
   My bibliography  Save this article

Healthy Bodies and Thick Wallets: The Dual Relation between Health and Economic Status


  • James P. Smith


This paper sketches theoretical reasons why health may alter household savings and provides evidence on the empirical impact of health shocks on household wealth. The impacts on saving are quantitatively large and only partly explained by increased out-of-pocket medical expenses. Other contributing factors include reduced earnings and a revision in life expectancy. The author also delves into reasons why economic status, access to medical care, and deleterious personal behaviors have been rejected as insufficient explanations. New theories emphasize long-term impacts of early childhood or even intrauterine factors, cumulative effects of prolonged exposures to stress, or reactions of macrosocietal factors like rising levels of income inequality.

Suggested Citation

  • James P. Smith, 1999. "Healthy Bodies and Thick Wallets: The Dual Relation between Health and Economic Status," Journal of Economic Perspectives, American Economic Association, vol. 13(2), pages 145-166, Spring.
  • Handle: RePEc:aea:jecper:v:13:y:1999:i:2:p:145-166 Note: DOI: 10.1257/jep.13.2.145

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Hubbard, R Glenn & Skinner, Jonathan & Zeldes, Stephen P, 1995. "Precautionary Saving and Social Insurance," Journal of Political Economy, University of Chicago Press, vol. 103(2), pages 360-399, April.
    2. Michael Grossman, 1972. "The Demand for Health: A Theoretical and Empirical Investigation," NBER Books, National Bureau of Economic Research, Inc, number gros72-1, January.
    3. Smith, J-P, 1997. "Inheritances and Bequests," Papers 97-04, RAND - Labor and Population Program.
    4. Lillard, Lee A & Weiss, Yoram, 1997. "Uncertain Health and Survival: Effects on End-of-Life Consumption," Journal of Business & Economic Statistics, American Statistical Association, vol. 15(2), pages 254-268, April.
    Full references (including those not matched with items on IDEAS)

    More about this item

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:jecper:v:13:y:1999:i:2:p:145-166. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jane Voros) or (Michael P. Albert). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.