title: The causal effect of income on health: evidence from German reunification.
abstract: We investigate whether there was a causal effect of income changes on the health satisfaction of East and West Germans in the years following reunification. Our data source is the German Socio-Economic Panel (GSOEP) between 1984 and 2002, and we fit a recently proposed fixed-effects ordinal estimator to our health measures and use a causal decomposition technique to account for panel attrition. We find evidence of a significant positive effect of income changes on health satisfaction, but the quantitative size of this effect is small. This is the case with respect to current income and a measure of 'permanent' income.
authors.affiliation: RSSS, Australian National University, Australia.
authors.forename: Paul
authors.initials: P
authors.lastname: Frijters
authors.forename: John P
authors.initials: JP
authors.lastname: Haisken-DeNew
authors.forename: Michael A
authors.initials: MA
authors.lastname: Shields
mesh_terms: D000328:Adult; D003258:Consumer Behavior / Q000706:statistics & numerical data; D005260:Female; D005858:Germany; D006304:Health Status; D006801:Humans; D008297:Male; D008875:Middle Aged; D017059:Models, Econometric; D012923:Social Class