Earnings Growth and Movements in Self-Reported Health

We employ data from the Panel Study of Income Dynamics to investigate income to health causality. To account for unobserved heterogeneity, we focus on the relationship between earnings growth and changes in self-reported health status. Causal claims are predicated upon appropriate moment restrictions and specification tests of their validity. We find evidence of causality ∗Address: 2424 Maile Way; Saunders Hall 533; Honolulu, HI 96822. Tele: (808) 956-8615. Fax: (808) 956-4347 E-mail: [email protected]. This is a substantially revised version of an earlier paper titled, "Income Volatility and Health." I would like to thank Randy Akee, Jenny Aker, Meta Brown, Larry Katz, Pat Kline, Sumner La Croix, Jeremy Magruder, Ted Miguel, Enrico Moretti, Chris Paxson, Chris Ruhm and Lowell Taylor for useful feedback. Finally, I would like to thank the editor of this journal and two anonymous referees for invaluable comments. The usual disclaimer applies.