Publication Type
Journal Article
Version
acceptedVersion
Publication Date
3-2021
Abstract
We estimate the causal effects of household income on self-reported health status by exploiting random variations in the amount of lottery prizes won. We find that a S$10,000 (US$7,245) increase in income via lottery wins improves individuals’ health by a standard deviation of 0.18. As possible mechanisms, we find that lottery wins increase household consumption spending and improve overall life satisfaction, but do not change healthcare spending, labor supply, and risky health behavior. Previous studies, which focused on the health effects of lottery prizes in Western European countries with strong social safety nets, do not find positive effects other than those on mental health. By contrast, the current study contributes to the literature by providing new evidence of the positive health effect of income via lottery wins in a country without strong social safety nets.
Keywords
lottery prize, health, unearned income, Singapore
Discipline
Asian Studies | Behavioral Economics | Health Economics
Research Areas
Applied Microeconomics
Publication
Journal of Health Economics
Volume
76
First Page
1
Last Page
15
ISSN
0167-6296
Identifier
10.1016/j.jhealeco.2020.102414
Publisher
Elsevier
Citation
KIM, Seonghoon and KOH, Kanghyock.
The effects of income on health: Evidence from lottery wins in Singapore. (2021). Journal of Health Economics. 76, 1-15.
Available at: https://ink.library.smu.edu.sg/soe_research/2424
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1016/j.jhealeco.2020.102414