Modelling and Measuring Inequality of Opportunity in Health: Evidence from a Cohort Study

Pedro Rosa Dias ()

Health, Econometrics and Data Group (HEDG) Working Papers from HEDG, c/o Department of Economics, University of York

Abstract: This paper uses data from the National Child Development Study to propose an empirical implementation of the concept of inequality of opportunity in health. Drawing on the distinction between circumstance and effort variables in John Roemer's work on equality of opportunity, circumstances are proxied by parental socio-economic status and childhood health; effort is proxied by health-related lifestyles and educational attainment. The paper is divided in three parts. First, a set of stochastic dominance tests is used to detect inequality of opportunity in the conditional distributions of self-assessed health in adulthood. Second, relying on a comprehensive set of circumstances, two alternative approaches are used to measure inequality of opportunity in health. Finally, in order to illuminate the triangular relationship between circumstances, effort and health, a structural model which relates selfassessed health in adulthood to lifestyles and educational attainment is considered. A recursive system of equations for self-assessed health, lifestyles and educational attainment is estimated by full information maximum likelihood to unveil the causal relationships at stake. The results indicate the existence of considerable and persistent inequality of opportunity in health. They also suggest that circumstances affect health in adulthood both directly and through effort factors such as educational attainment. This indicates that, while the influence of some unjust circumstances can only be tackled during childhood, the implementation of complementary educational policies may be of paramount importance to reduce health inequalities.

Date: 2008-05
New Economics Papers: this item is included in nep-hap and nep-hea
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