Do Economic Inequalities Harm Health? Evidence from Europe

Abstract

Using the European Community Household Panel (1994-2001), random effects models are estimated to assess the effect of income inequality on individuals' health. The individual's health status is measured by self assessment responses and by relatively objective measures of health. Country-level inequality measures are used after controlling for regional fixed effects. This implies that country level factors are the relevant approximations of individuals' reference groups. The results suggest that income inequality harms not only the health of the least well off but also the health of all individuals regardless of their position in the income distribution.