MPIDR Working Paper

Income inequality and population health: a panel data analysis on 21 developed countries

Abstract

The relative income-health hypothesis postulates that income distribution is one of the key determinants of population health. The discussion on the age and gender patterns of this association is still open. We test the relative income-health hypothesis using a panel data covering 21 developed countries for over 30 years. We find that net of trends in GDP per head and unobserved period and country factors, income inequality, measured by the Gini index, is strongly and positively associated with male and female mortality up to age 15. For women the association vanishes at older ages, but for men persists up to age 50. These findings suggest that policies decreasing income inequality may improve the health of children and young- to middle-aged men. The mechanisms behind the income inequality-mortality association are not known, but may be related to parental stress and male competition. Future research could focus on unravelling these mechanisms