Document Type
Article
Abstract
This paper estimates the demand for health among low-wage American workers. I incorporate theoretical assumptions and empirical findings from the fields of food and health economics to derive a utility-maximization framework, which posits health is a normal good. Using data from the Panel Study on Income Dynamics, I then regress an ordered probit random effects model to isolate the effect of income fluctuations on health over time. These results are statistically significant and robust to numerous specification checks, suggesting low-wage workers experience improved health levels as their wages increase. These findings deserve further inquiry to better-inform the current public debate over low-income workers’ wages.
Recommended Citation
Stern, Cory, "How Do Incremental Wage Increases Affect Low-Wage Workers’ Health Levels?" (2015). Award Winning Economics Papers. 16.
https://digitalcommons.macalester.edu/econaward/16
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Comments
This paper won Second Place in the Best Term Paper category at the Minnesota Economic Association conference in October 2015. It was written for Raymond Robertson's Introduction to Econometrics class in the Spring of 2015.