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Mortality Inequality

Mortality Inequality - Journal of Economic...

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Mortality Inequality Sam Peltzman T he measures of inequality most familiar to economists are based on income at a point in time. For example, suppose A has ten times the annual income of B and a certain society has many like B and only a few like A. By most measures, this society would be deemed more unequal than one with only a few B’s or with B’s who are richer relative to A’s. However, the typical income inequality measure leaves out an important dimension: the length of time over which an income or consumption stream is enjoyed (Becker, Philipson, and Soares, 2005). Thus, suppose A and B had identical annual incomes, but A lives twice as long. Clearly, A and B would not have the same total welfare. Moreover we might think the social distribution of welfare is rather unequal if there are only a few long-lived A’s and many short-lived B’s, notwithstanding their equal annual incomes. Any account of social inequality may be seriously incomplete if it ignores differences in longevity within the society. When economists confront mortality differences, either within or between societies, they tend to emphasize the correlation between income and longevity. A common finding here is the “Preston curve,” which shows that longevity increases with income, but at sharply decreasing rates either within or between societies (Preston, 1975; Cutler, Deaton, and Lleras-Muney, 2006). Across countries, this relation is meaningfully positive only for countries with per capita incomes below roughly half those in the developed world. Another finding is that rich–poor country differences in longevity have tended to decrease over time (Becker, Phil- ipson, and Soares, 2005). I will pay some attention to the connection between longevity and income, but most of the emphasis here will be on inequality of lifetimes as an interesting phenomenon in its own right. y Sam Peltzman is Ralph and Dorothy Keller Distinguished Service Professor of Economics Emeritus, Booth School of Business, University of Chicago, Chicago, Illinois. His e-mail address is [email protected] . Journal of Economic Perspectives—Volume 23, Number 4—Fall 2009—Pages 175–190
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The paper describes how changes in the inequality of lifetimes have contrib- uted to changes in the social distribution of welfare. I address the following questions: How can we measure inequality of lifetimes? How has this kind of inequality changed over time? How is this inequality related to increased longevity? How do these trends differ across and within countries? Unequal longevity was once a major source of social inequality, perhaps even more important in some sense than income inequality, for a long time. But over the last century, this inequality has declined drastically in high-income countries and is now comparatively trivial.
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