HEALTH Does improved health affect income? – Health Economist

Does improved health affect income? – Health Economist

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According to a recent article by Stephens and Toohey (2022)The answer is yes’.

This paper examines the labor market effects of a randomized health intervention for working-age men that focused on reducing mortality from coronary heart disease, the leading cause of death in the United States. MRFIT managed to improve the health of the Special Intervention group in several dimensions. We found that the intervention also significantly increased earnings by 3 percent and family income by 4 percent without a concurrent effect on labor force participation.

The authors note that there are other possible causal mechanisms to consider. For example, perhaps better health makes you more attractive to the other (or same) sex, and attractiveness leads to higher earnings. Alternatively, it could be the case that better health leads to greater longevity, which could affect investments in human capital. Despite these alternative explanations, the authors find that the observed increase in wages is likely a direct impact that improved health has on productivity.

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