[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp1488.html
   My bibliography  Save this paper

Socio-Economic Status, Health Shocks, Life Satisfaction and Mortality: Evidence from an Increasing Mixed Proportional Hazard Model

Author

Listed:
  • Frijters, Paul

    (London School of Economics)

  • de New, John

    (Melbourne Institute of Applied Economic and Social Research)

  • Shields, Michael A.

    (Monash University)

Abstract
The socio-economic gradient in health remains a controversial topic in economics and other social sciences. In this paper we develop a new duration model that allows for unobserved persistent individual-specific health shocks and provides new evidence on the roles of socio-economic characteristics in determining length of life using 19-years of high-quality panel data from the German Socio-Economic Panel. We also contribute to the rapidly growing literature on life satisfaction by testing if more satisfied people live longer. Our results clearly confirm the importance of income, education and marriage as important factors in determining longevity. For example, a one-log point increase in real household monthly income leads to a 12% decline in the probability of death. We find a large role for unobserved health shocks, with 5-years of shocks explaining the same amount of the variation in length of life as all the other observed individual and socio-economic characteristics (with the exception of age) combined. Individuals with a high level of life satisfaction when initially interviewed live significantly longer, but this effect is completely due to the fact that less satisfied individuals are typically less healthy. We are also able to confirm the findings of previous studies that self-assessed health status has significant explanatory power in predicting future mortality and is therefore a useful measure of morbidity. Finally, we suggest that the duration model developed in this paper is a useful tool when analyzing a wide-range of single-spell durations where individual-specific shocks are likely to be important.

Suggested Citation

  • Frijters, Paul & de New, John & Shields, Michael A., 2005. "Socio-Economic Status, Health Shocks, Life Satisfaction and Mortality: Evidence from an Increasing Mixed Proportional Hazard Model," IZA Discussion Papers 1488, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp1488
    as

    Download full text from publisher

    File URL: https://docs.iza.org/dp1488.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Geert Ridder, 1990. "The Non-Parametric Identification of Generalized Accelerated Failure-Time Models," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 57(2), pages 167-181.
    2. Deaton, Angus S & Paxson, Christina H, 1998. "Aging and Inequality in Income and Health," American Economic Review, American Economic Association, vol. 88(2), pages 248-253, May.
    3. Paul Contoyannis & Andrew M. Jones & Nigel Rice, 2004. "The dynamics of health in the British Household Panel Survey," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 19(4), pages 473-503.
    4. Ettner, Susan L., 1996. "New evidence on the relationship between income and health," Journal of Health Economics, Elsevier, vol. 15(1), pages 67-85, February.
    5. James P. Smith, 1999. "Healthy Bodies and Thick Wallets: The Dual Relation between Health and Economic Status," Journal of Economic Perspectives, American Economic Association, vol. 13(2), pages 145-166, Spring.
    6. van Doorslaer, Eddy & Wagstaff, Adam & Bleichrodt, Han & Calonge, Samuel & Gerdtham, Ulf-G. & Gerfin, Michael & Geurts, Jose & Gross, Lorna & Hakkinen, Unto & Leu, Robert E., 1997. "Income-related inequalities in health: some international comparisons," Journal of Health Economics, Elsevier, vol. 16(1), pages 93-112, February.
    7. Frijters, Paul, 2002. "The non-parametric identification of lagged duration dependence," Economics Letters, Elsevier, vol. 75(3), pages 289-292, May.
    8. Gardner, Jonathan & Oswald, Andrew, 2004. "How is mortality affected by money, marriage, and stress?," Journal of Health Economics, Elsevier, vol. 23(6), pages 1181-1207, November.
    9. Idler, E.L. & Angel, R.J., 1990. "Self-rated health and mortality in the NHANES-I epidemiologic follow-up study," American Journal of Public Health, American Public Health Association, vol. 80(4), pages 446-452.
    10. Benzeval, Michaela & Judge, Ken, 2001. "Income and health: the time dimension," Social Science & Medicine, Elsevier, vol. 52(9), pages 1371-1390, May.
    11. Van den Berg, Gerard J., 2001. "Duration models: specification, identification and multiple durations," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 55, pages 3381-3460, Elsevier.
    12. Jaap H. Abbring & Gerard J. van den Berg, 2003. "The Nonparametric Identification of Treatment Effects in Duration Models," Econometrica, Econometric Society, vol. 71(5), pages 1491-1517, September.
    13. Frijters, Paul & Haisken-DeNew, John P. & Shields, Michael A., 2005. "The causal effect of income on health: Evidence from German reunification," Journal of Health Economics, Elsevier, vol. 24(5), pages 997-1017, September.
    14. Peter Adams & Michael D. Hurd & Daniel L. McFadden & Angela Merrill & Tiago Ribeiro, 2004. "Healthy, Wealthy, and Wise? Tests for Direct Causal Paths between Health and Socioeconomic Status," NBER Chapters, in: Perspectives on the Economics of Aging, pages 415-526, National Bureau of Economic Research, Inc.
    15. Heckman, James J, 1991. "Identifying the Hand of the Past: Distinguishing State Dependence from Heterogeneity," American Economic Review, American Economic Association, vol. 81(2), pages 75-79, May.
    16. Heckman, James & Singer, Burton, 1984. "A Method for Minimizing the Impact of Distributional Assumptions in Econometric Models for Duration Data," Econometrica, Econometric Society, vol. 52(2), pages 271-320, March.
    17. Ulf-G. Gerdtham & Magnus Johannesson, 2004. "Absolute Income, Relative Income, Income Inequality, and Mortality," Journal of Human Resources, University of Wisconsin Press, vol. 39(1).
    18. Bo E. Honoré, 1993. "Identification Results for Duration Models with Multiple Spells," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 60(1), pages 241-246.
    19. Baker, Michael & Melino, Angelo, 2000. "Duration dependence and nonparametric heterogeneity: A Monte Carlo study," Journal of Econometrics, Elsevier, vol. 96(2), pages 357-393, June.
    20. Meer, Jonathan & Miller, Douglas L. & Rosen, Harvey S., 2003. "Exploring the health-wealth nexus," Journal of Health Economics, Elsevier, vol. 22(5), pages 713-730, September.
    21. Gravelle, Hugh & Wildman, John & Sutton, Matthew, 2002. "Income, income inequality and health: what can we learn from aggregate data?," Social Science & Medicine, Elsevier, vol. 54(4), pages 577-589, February.
    22. Adda, Jerome & Chandola, Tarani & Marmot, Michael, 2003. "Socio-economic status and health: causality and pathways," Journal of Econometrics, Elsevier, vol. 112(1), pages 57-63, January.
    23. Mikael Lindahl, 2005. "Estimating the Effect of Income on Health and Mortality Using Lottery Prizes as an Exogenous Source of Variation in Income," Journal of Human Resources, University of Wisconsin Press, vol. 40(1).
    24. Chris Elbers & Geert Ridder, 1982. "True and Spurious Duration Dependence: The Identifiability of the Proportional Hazard Model," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 49(3), pages 403-409.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Deborah A. Cobb‐Clark & Stefanie Schurer, 2013. "Two Economists' Musings on the Stability of Locus of Control," Economic Journal, Royal Economic Society, vol. 0, pages 358-400, August.
    2. Wenshu Gao & Russell Smyth, 2010. "Health Human Capital, Height and Wages in China," Journal of Development Studies, Taylor & Francis Journals, vol. 46(3), pages 466-484.
    3. René Böheim & Käthe Knittler & Helmut Mahringer, 2008. "Einfluss von Erwerbslaufbahn und Nachtschwerarbeit auf die Lebenserwartung. Sterberisiko der Männer der Kohorten 1924 bis 1949 in Österreich," WIFO Studies, WIFO, number 31719, March.
    4. S. Balia, 2007. "Reporting expected longevity and smoking: evidence from the SHARE," Working Paper CRENoS 200705, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    5. Rablen, Matthew D. & Oswald, Andrew J., 2007. "Mortality and Immortality," The Warwick Economics Research Paper Series (TWERPS) 785, University of Warwick, Department of Economics.
    6. Eiji Yamamura, 2011. "Differences in the effect of social capital on health status between workers and non-workers," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 58(4), pages 385-400, December.
    7. Johnston, David W. & Propper, Carol & Shields, Michael A., 2009. "Comparing subjective and objective measures of health: Evidence from hypertension for the income/health gradient," Journal of Health Economics, Elsevier, vol. 28(3), pages 540-552, May.
    8. Mevlude Akbulut-Yuksel, 2014. "Children of War: The Long-Run Effects of Large-Scale Physical Destruction and Warfare on Children," Journal of Human Resources, University of Wisconsin Press, vol. 49(3), pages 634-662.
    9. Débora Godoy-Izquierdo & Raquel Lara Moreno & María Vázquez Pérez & Francisco Araque Serrano & Juan Godoy García, 2013. "Correlates of Happiness Among Older Spanish Institutionalised and Non-Institutionalised Adults," Journal of Happiness Studies, Springer, vol. 14(2), pages 389-414, April.
    10. Christopher J. Boyce & Andrew J. Oswald, 2012. "Do people become healthier after being promoted?," Health Economics, John Wiley & Sons, Ltd., vol. 21(5), pages 580-596, May.
    11. Andrew M. Jones & Stefanie Schurer, 2011. "How does heterogeneity shape the socioeconomic gradient in health satisfaction?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 26(4), pages 549-579, June.
    12. Hostenkamp, Gisela & Stolpe, Michael, 2008. "The social costs of health-related early retirement in Germany: Evidence from the German Socio-economic panel," Kiel Working Papers 1415, Kiel Institute for the World Economy (IfW Kiel).
    13. R. Veenhoven, 2008. "Healthy happiness: effects of happiness on physical health and the consequences for preventive health care," Journal of Happiness Studies, Springer, vol. 9(3), pages 449-469, September.
    14. Frijters, Paul & Ulker, Aydogan, 2008. "Robustness in health research: Do differences in health measures, techniques, and time frame matter?," Journal of Health Economics, Elsevier, vol. 27(6), pages 1626-1644, December.
    15. Schneider, Julia & Beblo, Miriam, 2010. "Health at work - indicators and determinants : a revised literature and data review for Germany," IAB-Discussion Paper 201017, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    16. Cobb-Clark, Deborah & Schurer, Stefanie, 2011. "Two economists’ musings on the stability of locus of control," Working Paper Series 1619, Victoria University of Wellington, School of Economics and Finance.
    17. Lelkes, Orsolya, 2008. "Happiness over the life cycle: exploring age-specific preferences," MPRA Paper 7302, University Library of Munich, Germany.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Beomsoo Kim & Christopher J. Ruhm, 2012. "Inheritances, health and death," Health Economics, John Wiley & Sons, Ltd., vol. 21(2), pages 127-144, February.
    2. Cheng, Lingguo & Liu, Hong & Zhang, Ye & Zhao, Zhong, 2018. "The health implications of social pensions: Evidence from China's new rural pension scheme," Journal of Comparative Economics, Elsevier, vol. 46(1), pages 53-77.
    3. Hernández-Quevedo, Cristina & Jones, Andrew M. & Rice, Nigel, 2008. "Persistence in health limitations: A European comparative analysis," Journal of Health Economics, Elsevier, vol. 27(6), pages 1472-1488, December.
    4. Owen O'Donnell & Eddy Van Doorslaer & Tom Van Ourti, 2013. "Health and Inequality," Tinbergen Institute Discussion Papers 13-170/V, Tinbergen Institute.
    5. Johnston, David W. & Propper, Carol & Shields, Michael A., 2009. "Comparing subjective and objective measures of health: Evidence from hypertension for the income/health gradient," Journal of Health Economics, Elsevier, vol. 28(3), pages 540-552, May.
    6. Frijters, Paul & Haisken-DeNew, John P. & Shields, Michael A., 2005. "The causal effect of income on health: Evidence from German reunification," Journal of Health Economics, Elsevier, vol. 24(5), pages 997-1017, September.
    7. Oscar Erixson, 2017. "Health responses to a wealth shock: evidence from a Swedish tax reform," Journal of Population Economics, Springer;European Society for Population Economics, vol. 30(4), pages 1281-1336, October.
    8. Fu-Min Tseng & Dennis James Petrie, 2014. "The Implications for Health, Depression, and Life Satisfaction from a Permanent Increase in Income for the Disadvantaged Elderly: Evidence from Taiwan," Review of Social Economy, Taylor & Francis Journals, vol. 72(3), pages 311-336, September.
    9. Costa-Font, Joan & Hernández-Quevedo, Cristina, 2012. "Measuring inequalities in health: What do we know? What do we need to know?," Health Policy, Elsevier, vol. 106(2), pages 195-206.
    10. Maite Blázquez & Elena Cottini & Ainhoa Herrarte, 2014. "The socioeconomic gradient in health: how important is material deprivation?," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 12(2), pages 239-264, June.
    11. Van den Berg, Gerard J., 2001. "Duration models: specification, identification and multiple durations," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 55, pages 3381-3460, Elsevier.
    12. Frijters, Paul & Ulker, Aydogan, 2008. "Robustness in health research: Do differences in health measures, techniques, and time frame matter?," Journal of Health Economics, Elsevier, vol. 27(6), pages 1626-1644, December.
    13. Currie, Alison & Shields, Michael A. & Price, Stephen Wheatley, 2007. "The child health/family income gradient: Evidence from England," Journal of Health Economics, Elsevier, vol. 26(2), pages 213-232, March.
    14. Bo E. Honoré & Aureo de Paula, 2009. ""Interdependent Durations" Third Version," PIER Working Paper Archive 09-039, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 01 Feb 2008.
    15. Bonev, Petyo, 2020. "Nonparametric identification in nonseparable duration models with unobserved heterogeneity," Economics Working Paper Series 2005, University of St. Gallen, School of Economics and Political Science.
    16. Hausman, Jerry A. & Woutersen, Tiemen, 2014. "Estimating a semi-parametric duration model without specifying heterogeneity," Journal of Econometrics, Elsevier, vol. 178(P1), pages 114-131.
    17. Bo E. Honor & Áureo De Paula, 2010. "Interdependent Durations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 77(3), pages 1138-1163.
    18. Maite Blázquez Cuesta & Santiago Budría, 2013. "Does income deprivation affect people’s mental well-being?," Working Papers 1312, Banco de España.
    19. Rehkopf, David H. & Jencks, Christopher & Glymour, M. Maria, 2010. "The association of earnings with health in middle age: Do self-reported earnings for the previous year tell the whole story?," Social Science & Medicine, Elsevier, vol. 71(3), pages 431-439, August.
    20. Maite Blázquez Cuesta & Elena Cottini & Herrarte, A. (Ainhoa), 2012. "GINI DP 39: Socioeconomic Gradient in Health: How Important is Material Deprivation?," GINI Discussion Papers 39, AIAS, Amsterdam Institute for Advanced Labour Studies.

    More about this item

    Keywords

    mortality; income; education; marriage; life satisfaction; shocks; duration analysis;
    All these keywords.

    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp1488. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.