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Inequality in Health

Hansson, Fredrik LU (2013) NEKH01 20131
Department of Economics
Abstract
There is a strong consensus in the academic literature over the historical importance of economic growth for improvements in overall health quality, but stagnating increases in life expectancy in high-income countries seems to point towards a diminishing correlation between economic growth and health. A theory that has gained popularity in recent years is that a decreasing importance of absolute income levels as a determinant for people’s health has been accompanied by an increasing importance of relative income. This thesis sets out to test the relative income hypothesis by analyzing if changes in aggregate income inequality have an effect on individual’s subjective health.
The theoretical assumption is that individuals make social... (More)
There is a strong consensus in the academic literature over the historical importance of economic growth for improvements in overall health quality, but stagnating increases in life expectancy in high-income countries seems to point towards a diminishing correlation between economic growth and health. A theory that has gained popularity in recent years is that a decreasing importance of absolute income levels as a determinant for people’s health has been accompanied by an increasing importance of relative income. This thesis sets out to test the relative income hypothesis by analyzing if changes in aggregate income inequality have an effect on individual’s subjective health.
The theoretical assumption is that individuals make social comparisons between themselves and the national average. Widened income gaps will then increase the level of psychological stress hormones, which have been found to cause various diseases, and thereby decrease the individual’s level of subjective health.
The results from this analysis are unsupportive of the relative income hypothesis, indicating that absolute income is still a more important determinant of people’s health. (Less)
Please use this url to cite or link to this publication:
author
Hansson, Fredrik LU
supervisor
organization
alternative title
Testing the relative income hypothesis
course
NEKH01 20131
year
type
M2 - Bachelor Degree
subject
keywords
income inequality, subjective health, relative income hypothesis
language
English
id
3815056
date added to LUP
2013-06-20 11:30:36
date last changed
2013-06-20 11:30:36
@misc{3815056,
  abstract     = {There is a strong consensus in the academic literature over the historical importance of economic growth for improvements in overall health quality, but stagnating increases in life expectancy in high-income countries seems to point towards a diminishing correlation between economic growth and health. A theory that has gained popularity in recent years is that a decreasing importance of absolute income levels as a determinant for people’s health has been accompanied by an increasing importance of relative income. This thesis sets out to test the relative income hypothesis by analyzing if changes in aggregate income inequality have an effect on individual’s subjective health.
 The theoretical assumption is that individuals make social comparisons between themselves and the national average. Widened income gaps will then increase the level of psychological stress hormones, which have been found to cause various diseases, and thereby decrease the individual’s level of subjective health. 
 The results from this analysis are unsupportive of the relative income hypothesis, indicating that absolute income is still a more important determinant of people’s health.},
  author       = {Hansson, Fredrik},
  keyword      = {income inequality,subjective health,relative income hypothesis},
  language     = {eng},
  note         = {Student Paper},
  title        = {Inequality in Health},
  year         = {2013},
}