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Be Wealthy to Stay Healthy: An Analysis of Older Australians Using the HILDA Survey

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  • Lixin Cai

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

Abstract

Using the Household, Income and Labour Dynamics in Australia (HILDA) survey data, this study examines the effect of wealth, as measured by net worth, on health transitions of older Australians. By focusing on health transitions instead of health status itself, the study avoids potential endogeneity of wealth arising from the reverse effect of health on wealth. Two health indicators are used to define health transitions: self-reported general health status and the existence of long-term health conditions. The results show that for both health indicators wealthy people are less likely to experience a transition from good to poor health, suggesting that wealth might have a causal effect on health.

Suggested Citation

  • Lixin Cai, 2008. "Be Wealthy to Stay Healthy: An Analysis of Older Australians Using the HILDA Survey," Melbourne Institute Working Paper Series wp2008n08, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  • Handle: RePEc:iae:iaewps:wp2008n08
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    File URL: http://melbourneinstitute.unimelb.edu.au/downloads/working_paper_series/wp2008n08.pdf
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    References listed on IDEAS

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