Broke, Ill, and Obese: The Effect of Household Debt on Health

Matthias Keese and Hendrik Schmitz

No 350, SOEPpapers on Multidisciplinary Panel Data Research from DIW Berlin, The German Socio-Economic Panel (SOEP)

Abstract: We analyze the effect of household indebtedness on different health outcomes using data from the German Socio-Economic Panel from 1999-2009. To establish a causal effect, we rely on (a) fixed-effects methods, (b) a subsample of constantly employed individuals, and (c) lagged debt variables to rule out problems of reverse causality. We apply different measures of household indebtedness, such as the percentage shares of household income spent on consumer credit and home loan repayments (which indicate the severity of household indebtedness) and a binary variable of relative overindebtedness (which indicates a precarious debt situation). We find all debt measures to be strongly correlated with health satisfaction, mental health, and obesity. Controlling for unobserved heterogeneity and reversed causality we find evidence that household debt also causally deteriorates physical and mental health. However, there is no causal effect on being obese.

Keywords: Debt; health satisfaction; mental health; obesity; fixed-effects (search for similar items in EconPapers)
JEL-codes: D12 D14 I12 (search for similar items in EconPapers)
Pages: 28 p.
Date: 2010
New Economics Papers: this item is included in nep-hap and nep-hea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
https://www.diw.de/documents/publikationen/73/diw_01.c.366778.de/diw_sp0350.pdf (application/pdf)

Related works:
Working Paper: Broke, Ill, and Obese: The Effect of Household Debt on Health (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:diw:diwsop:diw_sp350

Access Statistics for this paper

More papers in SOEPpapers on Multidisciplinary Panel Data Research from DIW Berlin, The German Socio-Economic Panel (SOEP) Contact information at EDIRC.
Bibliographic data for series maintained by Bibliothek (bibliothek@diw.de).