London School of Economics The Suntory and Toyota International Centres for Economics and Related Disciplines LSE
The Suntory and Toyota International Centres for Economics and Related Disciplines (STICERD)

Abstract for:

Estimates of the asset-effect: The search for a causal effect of assets on adult health and employment outcomes

Abigail McKnight, June 2011
Paper No' CASE/149: | Full paper (pdf)
Save Reference as: BibTeX BibTeX File | Endote EndNote Import File
Keywords: asset effect; wealth, asset-based welfare

JEL Classification:

Is hard copy/paper copy available? YES - Paper Copy Still In Print.
This Paper is published under the following series: CASE Papers
Share this page: Google Bookmarks Google Bookmarks | Facebook Facebook | Twitter Twitter

Abstract:

In this paper we seek to determine the effect of assets held in early adult life on later outcomes. We specifically look at wages, employment prospects, general health and Malaise. The identification of an asset-effect throws up a number of statistical challenges as asset holding is not random. We employ a number of statistical techniques in our search for the causal effect of assets on adult health and employment outcomes. We find that simple Ordinary Least Squares and probit estimates of the asset effect are indeed biased in many cases. However, after applying a battery of techniques to remove such biases, the conclusion is that within the cohort examined (born in 1958), early asset holding does have positive effects on later wages, employment prospects, excellent general health and in reducing malaise.