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Alexander Ahammer, Thomas Horvath, Rudolf Winter-Ebmer
The effect of income on mortality – new evidence for the absence of a causal link
Journal of the Royal Statistical Society: Series A (Statistics in Society), 2016, http://onlinelibrary.wiley.com/doi/10.1111/rssa.12240/full
We analyse the effect of income on mortality in Austria by 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. Although we find quantitatively small yet statistically significant effects in our naive least squares estimations, instrumental variables regressions reveal a robust zero effect of income on 10-year death rates for workers aged 40 to 60 years, both in terms of coefficient magnitude and narrow width of confidence intervals. These results are robust to various sample specifications and both linear and non-linear estimation methods.
Keywords:Health; Income; Mortality; Wage decomposition
Research group:Labour Economics, Income and Social Security
Language:English