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The Effect of Income on Mortality – New Evidence for the Absence of a Causal Link

Author

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  • Alexander Ahammer
  • Thomas Horvath
  • Rudolf Winter-Ebmer
Abstract
We analyze the effect of income on mortality in Austria using administrative social security data. To tackle potential endogeneity concerns arising in this context, we estimate time-invariant firm-specific wage components and use them as instruments for actual wages. While we do find quantitatively small yet statistically significant effects in our naïve least squares estimations, IV regressions reveal a robust zero-effect of income on ten-year death rates for prime-age workers, both in terms of coefficient magnitude and statistical significance. These results are robust to a number of different sample specifications and both linear and non-linear estimation methods.

Suggested Citation

  • Alexander Ahammer & Thomas Horvath & Rudolf Winter-Ebmer, 2015. "The Effect of Income on Mortality – New Evidence for the Absence of a Causal Link," Economics working papers 2015-04, Department of Economics, Johannes Kepler University Linz, Austria.
    • Handle: RePEc:jku:econwp:2015_04
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    Cited by:

    1. Alexander Ahammer & Thomas Schober, 2020. "Exploring variations in health‐care expenditures—What is the role of practice styles?," Health Economics, John Wiley & Sons, Ltd., vol. 29(6), pages 683-699, June.
    2. Dorn, Florian & Lange, Berit & Braml, Martin & Gstrein, David & Nyirenda, John L.Z. & Vanella, Patrizio & Winter, Joachim & Fuest, Clemens & Krause, Gérard, 2023. "The challenge of estimating the direct and indirect effects of COVID-19 interventions – Toward an integrated economic and epidemiological approach," Economics & Human Biology, Elsevier, vol. 49(C).
    3. Alexander Ahammer & Dominik Grübl & Rudolf Winter-Ebmer, 2020. "The health externalities of downsizing," CDL Aging, Health, Labor working papers 2020-05, The Christian Doppler (CD) Laboratory Aging, Health, and the Labor Market, Johannes Kepler University Linz, Austria.
    4. Mathieu Lefèbvre & Pierre Pestieau & Gregory Ponthiere, 2019. "Premature mortality and poverty measurement in an OLG economy," Journal of Population Economics, Springer;European Society for Population Economics, vol. 32(2), pages 621-664, April.
    5. Schnalzenberger, Mario, 2016. "Causal effect of income on health: Investigating two closely related policy reforms in Austria," The Journal of the Economics of Ageing, Elsevier, vol. 7(C), pages 6-16.
    6. Alexander Ahammer, 2016. "How Physicians Affect Patients’ Employment Outcomes Through Deciding on Sick Leave Durations," Economics working papers 2016-05, Department of Economics, Johannes Kepler University Linz, Austria.
    7. Alexander Ahammer, 2018. "Physicians, sick leave certificates, and patients' subsequent employment outcomes," Health Economics, John Wiley & Sons, Ltd., vol. 27(6), pages 923-936, June.
    8. Schiele, Valentin & Schmitz, Hendrik, 2016. "Quantile treatment effects of job loss on health," Journal of Health Economics, Elsevier, vol. 49(C), pages 59-69.

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    More about this item

    Keywords

    Income; mortality; wage decomposition.;
    All these keywords.

    JEL classification:

    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • I10 - Health, Education, and Welfare - - Health - - - General

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