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Socioeconomic Gradient in Health: How Important is Material Deprivation?

  • Blázquez, Maite

    ()

    (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.)

  • Cottini, Elena

    (Università Cattolica del Sacro Cuore)

  • Herrarte, Ainhoa

    ()

    (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid)

In this paper we use the Spanish Living Conditions Survey (2005-2008) to investigate whether there is a socioeconomic gradient in health when alternative measures of socioeconomic status, apart from income, are considered. In particular we construct a material deprivation index that reflects some minimum standards of quality of life, and we analyze its impact on self-reported health. To address this issue, we use a deprivation index that incorporates comparison effects with societal peers and we estimate health equations using a random effects model. Furthermore, the model is extended to include a Mundlak term that corrects for the potential correlation between the error term and the regressors. Our results reveal that the relationship between health and income operates through comparison information with respect to societal peers. In contrast, material deprivation in terms of financial difficulties, basic necessities and housing conditions exerts a direct effect on individual health.

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Paper provided by Universidad Autónoma de Madrid (Spain), Department of Economic Analysis (Economic Theory and Economic History) in its series Working Papers in Economic Theory with number 2012/07.

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Length: 31 pages
Date of creation: Mar 2012
Date of revision:
Handle: RePEc:uam:wpaper:201207
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  1. Lindeboom, Maarten & van Doorslaer, Eddy, 2004. "Cut-point shift and index shift in self-reported health," Journal of Health Economics, Elsevier, vol. 23(6), pages 1083-1099, November.
  2. Ada Ferrer-i-Carbonell & Paul Frijters, 2004. "How Important is Methodology for the estimates of the determinants of Happiness?," Economic Journal, Royal Economic Society, vol. 114(497), pages 641-659, 07.
  3. Adams, Peter & Hurd, Michael D. & McFadden, Daniel & Merrill, Angela & Ribeiro, Tiago, 2003. "Healthy, wealthy, and wise? Tests for direct causal paths between health and socioeconomic status," Journal of Econometrics, Elsevier, vol. 112(1), pages 3-56, January.
  4. McBride, Michael, 2001. "Relative-income effects on subjective well-being in the cross-section," Journal of Economic Behavior & Organization, Elsevier, vol. 45(3), pages 251-278, July.
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