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Gimpelson and Treisman: Misperceiving Inequality

December 3, 2015

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Neumayer and Plumper: Inequalities of Income and Inequalities of Longevity: A Cross-Country Study

January 17, 2017

A copy of the paper can be found here

 

The Point: Inequality in longevity is one of the most poignant forms of health inequality. Previous studies have focused on the statistically significant relationship between educational inequalities and life span variation in European countries (van Raalte AA, Kunst AE, Deboosere P, et. al). Other country level research has examined the extent to which socioeconomic inequality can provide some elucidation on the strong variation in adult life spans in the United States (Edwards RD, Tuljapurkar S). However previous research carried out using bivariate plots at a country level, found no clear relationship between income inequality and inequality in longevity. By contrast, using a multivariate statistical model in a cross-country study of 28 European countries, this article finds an important statistical association between income inequality and longevity inequality.

 

The researchers show that greater pre-tax income inequality was statistically significant in relation to greater longevity inequality. Addressing the natural belief that a legitimate method of addressing longevity inequality is through increased health expenditure, the article suggests that, for the most part, total health expenditure has no statistically significant effect on longevity. The article goes further to say that if additional health care spending benefits people previously considered too old to receive treatment (a relevant point for developed countries), then additional health care spending could have a positive relationship with longevity inequality; as spending increases, longevity inequality rises. The article does, however, find a statistically significant relationship between greater income distribution and lower longevity inequality. This indicates that rather than increasing government expenditure on healthcare, the government can directly affect longevity inequality by introducing policies to reduce income inequality via taxes and transfers. This is a strong argument for the government to pursue income redistribution policies beyond the health care policies traditionally used to target longevity inequality.

 

The Quote(s):

"[I]ncome inequality and policies that reduce it have a substantively important association with longevity inequality in a cross country study. Societies that are more unequal in income are also more unequal in number of years lived." (6)

 

"[R]elationship between per capita income and inequality in longevity, [is] similar to the inverted U-shaped relationship between per capita income and income inequality famously suggested by Nobel Prize winner Simon Kuznets’ (4)

 

"[A]n additional percentage point in the Gini coefficient of pretax income inequality was predicted to increase the Gini coefficient of longevity by between 0.0069 and 0.0129 percentage points in the short run and correspondingly, by between 0.046 and 0.058 percentage points in the long run. A percentage point reduction from the Gini coefficient of pretax income inequality to the Gini coefficient of post tax income inequality was predicted to decrease the Gini coefficient of longevity by between 0.0064 and 0.0102 percentage points in the short run and by between 0.043 and 0.051 percentage points in the long run." (4)

 

Method and Data: Life tables sourced from the Human Mortality Database were used to compute the Gini coefficient of longevity. Researches regressed longevity inequality on market income inequality and income distribution, controlling for potential confounders, in a cross sectional time series. As measures of market income inequality and income redistribution, researchers used the Gini coefficient of incomes before taxes and transfers, and the absolute difference between the Gini coefficient of incomes before taxes and transfers and the Gini coefficient of incomes after taxes and transfers. Data for these measures came from the Organization of Economic Co-operation and Development. In addition, data regarding information on GDP per capita in1000 Purchasing Power Parity dollars and total health expenditure per GDP was sourced from the Organization of Economic Co-operation and Development and the World Health Organization’s European Health for All database.

 

Citation: Neumayer, Eric and Plümper, Thomas (2016) Inequalities of income and inequalities of longevity: a cross-country study. American Journal of Public Health , 106 (1). pp. 160-165.

DOI: 10.2105/AJPH.2015.302849

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