The Effects of Health Events on the Economic Status of Married Couples

Abstract

There is a growing literature showing the relationship between health and economic status, though little research has focused on distinguishing between the effects for men and women. I use measures of exogenous health “shocks” to identify the different channels through which changes in health conditions affect income, wealth and consumption behavior of couples. The results indicate that serious health conditions have strong effects on household wealth, but that the effects for women are larger and more significant than the effects for men. The source of the asymmetry arises from the fact that general living expenses increase when wives become seriously ill, while for husbands, health shocks do not affect theses expenditures.

Keywords: Health, Shocks, Wealth

JEL Classification: D1,I1