That income level of a country is an important determinant of its health outcome is now accepted as a stylized fact. Generally, the trends in average levels of health indicators are more encouraging for rich countries than they are for poor countries. Yet, the supposition that richer is always healthier has been the topic of much controversy. Considerable variations in health outcomes are observed within a cluster of rich countries that are comparable in terms of their absolute level of income. It was suggested that as rich countries move through the epidemiological transition where chronic diseases have replaced infectious diseases as a source of mortality -the distribution of income, and the place of an individual in the social and economic hierarchy, become more important than level of average income in that society. The implication for developed countries is that further increase in per capita income will make little difference on health outcomes.
Recent report U.S. Health in an International Perspective published by The National Academy of Sciences provides some insight about the state of health in the US all but concludes that the US lags most industrialized and developed nations in every facet of health outcomes. Specifically, when compared with the average for peer countries, the United States fares worse in the following health domains: adverse birth outcomes, injuries and homicides, adolescent pregnancy and sexually transmitted infections (including HIV/AIDS), obesity and diabetes, heart disease, and disability.
The fact that the US exhibits such poor infant health outcomes, be it infant mortality, low birth baby, very low birth baby, and premature birth can in all likelihood be attributed to low absolute levels of income rather than to income inequality. It seems, both from this reports and from a paper written by Olson et al, that the poorest infants in the U.S. are affected more by absolute income than by relative income. Hence, based of the explanation proposed above, it can be argued that the United States has not fully made the epidemiological transition, a conclusion that is both surprising and alarming. It is surprising because the United States is one of the richest nations in the world, and it is alarming because it suggests that the basic needs of the poorest children in this country are not being met.
The report further concludes: “Despite its large and powerful economy, the United States has higher rates of poverty and income inequality than most high-income countries. U.S. children are more likely than children in peer countries to grow up in poverty, and the proportion of today’s children who will improve their socioeconomic position and earn more than their parents is smaller than in many other high-income countries.” As is often said by Richard Wilkinson and others – if you want to live the American dream, go live in Denmark (or Sweden, or Norway).
Income inequality is also mentioned in the report as one social factor that affects health outcomes. According to the OECD, income inequality in the United States in the late 2000s was higher than the average of all OECD countries. There is an enormous body of research as to the supposed effect of income inequality on health and whether income inequality directly affects health outcomes, or whether there are additional mechanisms, through which inequality influences health. Regardless, we must be mindful of the fact that income inequality brings about economic segregation, lack of social cohesiveness, and the inability of the political system to deliver public good. Sounds familiar anyone?