Do Public Goods Explain the Relationship between Income Inequality and Birthweight?

Aparna Lhila, University of Georgia

This paper examines the relationship between income inequality and birthweight, and delves into one causal pathway through which inequality may operate upon health. The “neo-materialist” relationship between inequality and health argues that income inequality impacts health mainly because inequality affects the distribution of resources in a community. The 1991 and 2001 Natality Detail Files are augmented with community data from several sources, including the decennial Censuses, the Annual Survey of Government Finances and the Area Resource File. I find that public goods are positively correlated with birthweight; and income inequality is associated with higher public goods. Moreover, the inclusion of public goods measures as controls, strengthens the relationship between inequality and birthweight. Inasmuch as income inequality causally increases public goods, public goods dampen the negative effect of income inequality on birthweight. Studies that do not account for the public goods affect potentially underestimate the negative effect of inequality on birthweight.