Wealth and health behavior: Testing the concept of a health cost

Hans van Kippersluis and Titus Galama

European Economic Review, 2014, vol. 72, issue C, 197-220

Abstract: Wealthier individuals engage in healthier behavior. This paper seeks to explain this phenomenon by exploiting both inheritances and lottery winnings to test a theory of health behavior. We distinguish between the direct monetary cost and the indirect health cost (value of health lost) of unhealthy consumption. The health cost increases with wealth and the degree of unhealthiness, leading wealthier individuals to consume more healthy and moderately unhealthy, but fewer severely unhealthy goods. The empirical evidence presented suggests that differences in health costs may indeed partially explain behavioral differences, and ultimately health outcomes, between wealth groups.

Keywords: Health behavior; Wealth; Health capital; Unhealthy consumption (search for similar items in EconPapers)
JEL-codes: D91 I10 I12 I14 J24 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (28)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:72:y:2014:i:c:p:197-220

DOI: 10.1016/j.euroecorev.2014.10.003

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