News from CEBI: The difference in life span between wealthy and poor is smaller than hitherto expected

08. November 2018

Researchers from the DNRF’s Center for Economic Behavior and Inequality (CEBI) at the University of Copenhagen have developed a new analytic method to calculate inequality in expected life spans between wealthy and poor people with greater precision. The study was recently published in the journal PNAS.

Comparison in income between 40-year old Danish men and women and their expected life span (in Danish) The blue curve represents men and the red curve is representing women. Graphics: Political Ideas and Analysis/University of Copenhagen.

Head of center Claus Thustrup Kreiner, Assistant Professor Torben Heien Nielsen, and Ph.D. student Benjamin Ly Serena, from the basic research center CEBI, have developed a new method to measure the difference in expected life spans among wealthy and poor people with enhanced precision. In a new study published in PNAS, the researchers show that with this method, the difference in life spans between wealthy and poor people is not as significant as suggested by previous research. The study takes for its point of departure data for the entire population in Denmark from 1983-2003 and shows that over a period of 10 years, half of the poor move out of the poorest groups, who have the highest mortality rate. Likewise, half of the wealthy people move downward into groups with lower incomes and therefore cannot expect to have the same life span as those who stay in the wealthiest groups in society. The new aspect of the CEBI researchers’ calculation method is that it includes these movements in income among the different groups in society – a factor that has not been incorporated into previous research.

“The inequality in expected life spans has been overrated significantly if one considers the mobility in income, as our calculation method does. That can lead to false conclusions about what it will cost the public purse to finance welfare for the population,” said CEBI Ph.D. student Benjamin Ly Serena, who is one of the authors behind the study.

The researchers’ results challenge existing calculations in the field made by American economists in 2016; the economists did not include income mobility among rich and poor in their calculations. According to the American life span calculations, the difference in the life span of a 40-year-old male who is wealthy and a 40-year-old male with a low income is 6.5 years. But when the CEBI researchers’ calculation method is applied, a 40-year-old male in one of the wealthiest groups will live until he is 77.6 years compared with 75.2 years for a 40-year-old male from a lower-income group, a difference of 2.4 years in expected life span.

Thus, the difference in life spans between wealthy and poor is shorter than hitherto expected, and research shows that inequality overall has increased significantly within the last 30 years.

The expected human life span is an important factor to be aware of because of its impact on large parts of our society. That is why it is useful to develop realistic calculation models that can measure our expected life spans with precision across different groups in society.

Read the scientific article in PNAS here.

More information about the study can be found in a press release from the University of Copenhagen here(in Danish).