RT Journal Article
SR Electronic
T1 Estimating the Effect of Income on Health and Mortality Using Lottery Prizes as an Exogenous Source of Variation in Income
JF Journal of Human Resources
JO J Hum Resour
FD University of Wisconsin Press
SP 144
OP 168
DO 10.3368/jhr.XL.1.144
VO XL
IS 1
A1 Lindahl, Mikael
YR 2005
UL http://jhr.uwpress.org/content/XL/1/144.abstract
AB A vast literature has established a strong positive relation between income and health status and a negative relation with mortality. This paper studies the effects of income on health and mortality, using only the part of income variation due to a truly exogenous factor: monetary lottery prizes of individuals. The findings are that higher income causally generates good health and that this effect is of a similar magnitude as when traditional estimation techniques are used. A 10 percent income increase improves health by about 4–5 percent of a standard deviation.