Journal Article

Winning big but feeling no better? The effect of lottery prizes on physical and mental health

Authors

Publication date

2015

Abstract

We use British panel data to determine the exogenous impact of income on a number of individual health outcomes: general health status, mental health, physical health problems, and health behaviours (drinking and smoking). Lottery winnings allow us to make causal statements regarding the effect of income on health, as the amount won by winners is largely exogenous. Positive income shocks have no significant effect on self-assessed overall health, but a significant positive effect on mental health. This result seems paradoxical on two levels. First, there is a well-known gradient in health status in cross-sectional data, and second, general health should partly reflect mental health, so that we may expect both variables to move in the same direction. We propose a solution to the first apparent paradox by underlining the endogeneity of income. For the second, we show that lottery winnings are also associated with more smoking and social drinking. General health will reflect both mental health and the effect of these behaviours and so may not improve following a positive income shock.

Published in

Health Economics

Volume and page numbers

24 , 516 -538

DOI

http://dx.doi.org/10.1002/hec.3035

ISSN

16

Subjects

Income Dynamics, Well Being, and Health

Notes

Not held in Hilary Doughty Research Library - bibliographic reference only

Related publications

1. Winning big but feeling no better? The effect of lottery prizes on physical and mental health

   Bénédicte H. Apouey and Andrew E. Clark

   Research Paper, IZA Discussion Papers, 4730 - 2010
   1. Income Dynamics
   2. Well Being
   3. Health

2. Winning big but feeling no better? The effect of lottery prizes on physical and mental health

   Bénédicte H. Apouey and Andrew E. Clark

   Research Paper, PSE Working Papers, 2009-09 - 2009
   1. Income Dynamics
   2. Well Being
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