Thursday, March 19, 2015

Do Wealth and Income Cause Health?

It's fairly obvious in developed countries that those rich in wealth, rich in income, or rich in both, are healthier.

There's a presumption in discussions of public health and welfare that wealth and/or income causes health outcomes to improve, and therefore that inequality of wealth and/or health contributes inequality of health outcomes.

To the extent that one thinks that good health is human right conferred at birth, these presumptions form the basis for a moral case for redistribution of wealth and/or income.

Unless one of those assertions is false.

New research from David Cesarini and Erik Lindqvist entitled "Wealth, Health, and Child Development: Evidence from Administrative Data on Swedish Lottery Players" looks at the health outcomes of people before and after they get windfalls through lotteries.
... In adults, we find no evidence that wealth impacts mortality or health care utilization ...  
... We find that wealth increases children's health care utilization ..  and may also reduce obesity risk.The effects on most other child outcomes ... can usually be bounded to a tight interval around zero. Overall, our findings suggest that correlations observed in affluent, developed countries between (i) wealth and health or (ii) parental income and children's outcomes do not reflect a causal effect of wealth.
This is not a direct test, but it is suggestive that causality goes the other way: that people make lifestyle choices that are jointly beneficial to health, wealth and income, or jointly non-beneficial. So this research points in the direction that policies to redistribute income and wealth punish better choices and reward worse choices.

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