title: Why does Income Relate to Depressive Symptoms? Testing the Income Rank Hypothesis Longitudinally.
abstract: This paper reports a test of the relative income rank hypothesis of depression, according to which it is the rank position of an individual's income amongst a comparison group, rather than the individual's absolute income, that will be associated with depressive symptoms. A new methodology is developed to test between psychosocial and material explanations of why income relates to well-being. This method was used to test the income rank hypothesis as applied to depressive symptoms. We used data from a cohort of 10,317 individuals living in Wisconsin who completed surveys in 1992 and 2003. The utility assumed to arise from income was represented with a constant relative risk aversion function to overcome limitations of previous work in which inadequate specification of the relationship between absolute income and well-being may have inappropriately favoured relative income specifications. We compared models in which current and future depressive symptoms were predicted from: (a) income utility alone, (b) income rank alone, (c) the transformed difference between the individual's income and the mean income of a comparison group and (d) income utility, income rank and distance from the mean jointly. Model comparison overcomes problems involving multi-collinearity amongst the predictors. A rank-only model was consistently supported. Similar results were obtained for the association between depressive symptoms and wealth and rank of wealth in a cohort of 32,900 British individuals who completed surveys in 2002 and 2008. We conclude that it is the rank of a person's income or wealth within a social comparison group, rather than income or wealth themselves or their deviations from the mean within a reference group, that is more strongly associated with depressive symptoms.
authors.affiliation: Centre for Biostatistics, Institute of Population Health, University of Manchester, Oxford Road, Manchester, M13 9PL UK.
authors.forename: Hilda
authors.initials: H
authors.lastname: Osafo Hounkpatin
authors.affiliation: Behavioural Sciences Centre, Stirling Management School, University of Stirling, Stirling, FK8 1RB Scotland, UK ; Manchester Centre for Health Psychology, School of Psychological Sciences, University of Manchester, Manchester, M13 9PL UK.
authors.forename: Alex M
authors.initials: AM
authors.lastname: Wood
authors.affiliation: Department of Psychology, University of Warwick, Coventry, CV4 7AL UK.
authors.forename: Gordon D A
authors.initials: GD
authors.lastname: Brown
authors.affiliation: Centre for Biostatistics, Institute of Population Health, University of Manchester, Oxford Road, Manchester, M13 9PL UK.
authors.forename: Graham
authors.initials: G
authors.lastname: Dunn
keywords: Constant relative risk aversion (CRRA); Depressive symptoms; Income; Relative position; Social rank