| Summary: | This paper examines the association between inequality and individual health across low, middle and high income countries making use of a unique dataset containing information on the health status of individuals in 21 countries and territories throughout the world with very different characteristics. The survey covers respondents between the ages of 40 and 79. Our dependent variable is self-assessed health (SAH), a categorical variable which ranges from ‘very poor’ to ‘very good’. As a robustness check, we also consider activities of daily living (ADL). We estimate the relationship between economic inequalities and health and the relationship between reference group incomes and health – with particular focus on how the estimated effects depend on the reference group considered. We find strong evidence that average incomes within the own age group has a negative effect on health, thus giving support to the relative income hypothesis. This reference group seems to be more important than those based on geographic proximity. However, there seem to be important differences between high- and low-income countries in this and other respects. Finally, there is strong evidence of a general income inequality effect.
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