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Causal effect of income on health: Investigating two closely related policy reforms in Austria

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Abstract

I investigate the effect of income on mortality of the pensioners, com- paring three subsequent policy periods in Austria. The pensioners who retired in the second period received 25% lower pension than those in the first period. This reduction in income was removed in the third policy period. These two reforms allow a causal identification of the effect of in- come on health. I estimate that lower pension did not change the mortality rate. The results are confirmed using both experiments and different meth- ods of estimation. Furthermore, with regard to the expenditure on health services, I get that only prescribed drug consumption increased, with the remaining analyzed factors being unaffected.

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  • Mario Schnalzenberger, 2011. "Causal effect of income on health: Investigating two closely related policy reforms in Austria," Economics working papers 2011-09, Department of Economics, Johannes Kepler University Linz, Austria.
  • Handle: RePEc:jku:econwp:2011_09
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    Cited by:

    1. Joseph Francois & Miriam Manchin & Hanna Norberg & Olga Pindyuk & Patrick Tomberger, 2013. "Reducing Transatlantic Barriers to Trade and Investment: An Economic Assessment," IIDE Discussion Papers 20130401, Institue for International and Development Economics.
    2. Alexander Ahammer & G. Thomas Horvath & Rudolf Winter-Ebmer, 2017. "The effect of income on mortality—new evidence for the absence of a causal link," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 180(3), pages 793-816, June.

    More about this item

    Keywords

    Income; Mortality; Health; Expenditure;

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions

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