Algebraically, the Gini coefficient is defined as half of the arithmetic average of the absolute differences between all pairs of incomes in a population, the total then being normalized on mean income. Mellor JM, Milyo J. Reexamining the evidence of an ecological association between income inequality and health. In the case of the relative income hypothesis, the operationalization and measurement of “relative income” have proved problematic, because the choice of a relevant reference group against which individuals compare their own incomes is not obvious. Evidence that income inequality is associated with worse health is reviewed. As noted earlier, most studies do not estimate and model the state-attributable variation (or area-attributable variation) in an explicit multilevel manner. From a multilevel statistical perspective, the failure to explicitly model the variance structure of the data (e.g., individuals nested within states) amounts to ignoring information about the variability that we are seeking to explain through the fixed parameters of a statistical model. Or is it a marker for something else? Third, there is the policy pathway, whereby the adverse influence of income inequality may operate through formulation and implementation of general social policies, as well as through health-related policies. A user’s guide to MLwiN, version 2.1. The geography of health inequalities in the developed world. Subramanian SV. Income inequality may reflect social cohesion or social capital, and health at the individual level may not respond simply to absolute income but also to relativities in society, such as relative deprivation, relative income, and relative social status. Including individual educational attainment attenuates the state income inequality effect somewhat (OR = 1.34), but nonetheless it remains statistically significant. If recent national and global economic trends provide any indication, it is very likely that the subject matter of income inequality and its effects on population health will continue to be relevant for social epidemiology. (Letter). Heagerty PJ, Zeger SL. While these studies may have lacked statistical power, we also hasten to add that the lack of an association between income inequality and health at levels below the US states may be attributable to a true absence of an association (a finding corroborated in studies that were adequately powered, for instance, at the metropolitan area level (16)). For example, the average annual salary in America in inflation-adjusted 1998 dollars increased from $32,522 in 1970 to $35,864 in 1999, that is, a modest 10 percent increase over three decades. An American study of about 63,700 college students found that five times as many young adults are de… New York, NY: Oxford University Press, 2003:165–87. More recent studies, not included in those review … By contrast over the same period, the net worth of families in the lowest fifth of income earners rose 24 percent, to $7,900. Neighborhood differences in social capital: compositional artifact or a contextual construct? As illustrated in figure 2, in a hypothetical society consisting of just two individuals, that is, a rich one (with income x4) and a poor one (with income x1), transferring a given amount of money (amount x4 – amount x3) from the rich to the poor will result in an improvement in the average health (from y1 to y2), because the improvement in the health of the poor person more than offsets the loss in health of the rich person. State median income accounts for some 27 percent of the variation, and of the remaining variation (1 percent), state income inequality accounts for 35 percent of the variation. It may be noted that equation 1 will also typically include an “intercept” parameter (associated with a constant) and, since it is not of interpretative significance, in this instance, we did not explicitly include this in our equations. * Gini coefficient, an income inequality indicator. More recent studies, not included in those reviews, provide substantial new evidence. Kawachi I, Kennedy BP. (2002) ‘Income Inequality and Health Status in the United States: Evidence from the Current Population Survey’, Journal of Human Resources, 37: 510–39. Not surprisingly, the log odds associated with state income inequality invariably were all substantially smaller than the standard errors. ADVERTISEMENTS: Income and Wealth Inequality in Economics! https://doi.org/10.1016/j.socscimed.2014.12.031. Thus, while state income inequality explains an impressive fraction of the state-attributable variation, it seems to be explaining a great deal of a rather small contextual variation. Income includes the revenue streams from wages, salaries, interest on a savings account, dividends from shares of stock, rent, and profits from selling something for more than you paid for it. MULTILEVEL STUDIES OF INCOME INEQUALITY AND HEALTH: WHAT DOES THE EVIDENCE TELL US? Income distribution, socioeconomic status and self-rated health: a US multilevel analysis. At the state level, we considered the median household income in a state and the state Gini coefficient (a measure of income inequality (51)), with 0 implying no inequality and 1 representing complete inequality. That is, for whom is inequality most harmful, and why? The odds ratio of reporting poor health increases by 1.32 for every 5 percent increase in the state Gini coefficient when no account is taken of the individual income-health relation (model 1). While marginal models are robust (42) when our interest is only in estimating the “fixed” (average) effect of an exposure (e.g., income inequality), there may be problems of inefficiency (43). A multilevel analysis of income inequality and cardiovascular disease risk factors. Sen AK. Income inequality in the U.S. has grown over the past several decades. New York Times Jan 23, 2003:C1. Larsen K, Petersen JH, Budtz-Jorgensen E, et al. Both measures were derived from the 1989–1990 US Census (52, 53). From studies of neuroscience, it has been deducted that since income inequality diminish a sense of social cohesion and generalized trust among members of society, income inequality is being considered as a social stressor which affects health and behavioral outcomes (Pickett & Wilkinson, 2015). Indeed, it is possible that by transferring incomes from the relatively flat part of the income/health curve, there may be no loss in health for the wealthy. An aggregate study (60) found that the apparent association between US state-level income inequality and mortality rates disappeared after controlling for state differences in average educational attainment. Education, income inequality, and mortality: a multiple regression analysis. Rasbash J, Browne W, Goldstein H, et al. The theory, as well as empirical investigations of income distribution and health, can be usefully extended by a more systematic examination of the issue of what levels matter for population health and why. Using categories of income (model 7) yields an odds ratio of 1.30. Various measures are available to quantify the extent of income inequality within a given community or society. While multilevel models offer great potential in providing such details, researchers need to be cognizant of the challenges in estimating such summary statistics, especially in multilevel logistic models (73, 74), and there is little understanding on what proportion of the total state-attributable variation is “explainable” and what is simply “random.” Moreover, as the results suggest, it is entirely possible to estimate a statistically significant fixed effect for state income inequality (with an OR of about 1.20) even though the residual state-attributable variation is rather small. where yi is the health status of individual i; xi is the income of individual i; β* represents the nonlinear (or concave) nature of the relation between yi and xi; and ei is the residual differences in individual health, after accounting for individual income. U.S. income inequality in a cross-national perspective: why are we so different? The other methodological issue of relevance pertains to the choice of the modeling strategy. Income inequality and individual health: evidence from the Current Population Survey. A British study examining depression among people in their 20s found that it was twice as common in 1970 than it was in 1958. Health status may have a reciprocal relationship with income inequality. The major causal criteria of temporality, biological plausibility, consistency and lack of alternative explanations are well supported. With the fixed part specification being kept constant across the different modeling strategies, the point estimates for state income inequality from a simple binary logistic model (one that ignores the state-attributable variation) and the marginal binary logistic model (one that adjusts for the state-attributable variation but does not model it explicitly) were similar (β = 3.75), with the associated standard errors being substantially underestimated in the simple binary logistic model (standard error, 0.35) (table 9). Some observers have suggested that the relation between income inequality and poor health is confounded by differences in educational attainment (45, 59). Blakely T, O’Dea D, Atkinson J. However, these studies have been criticized because of their inability to disentangle the effects of individual income (and income poverty) from the contextual effects of income inequality (6). Change in the odds ratios and 95% confidence intervals for reporting fair/poor health (outcome) for a 5% change in US Gini coefficient* with a sequentially cumulative inclusion of different state and individual-level factors. Judging by our review, further studies need to be carried out, particularly in societies that are as unequal as, or more unequal than, the United States. Our intent here is not to provide a detailed assessment of each study. As mentioned earlier, multilevel statistical techniques provide a technically robust framework to analyze the clustered nature of the outcome variable and are pertinent when predictor variables are measured simultaneously at different levels (11). B. Multivariate regression analyses for categorical data to this pdf, sign in to an additional contextual effect income! With stereotypes E. income inequality is correlated with income inequality is assessed to... 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