Measurement of health, health inequality, and reporting heterogeneity

Using representative survey data of the German Socio-Economic Panel Study (SOEP) for 2006, we show that the magnitude of health inequality measures like the concentration index (CI) depends crucially on the underlying health measure. The highest degree of inequality is found when dichotomized subjective health measures like health satisfaction or self-assessed health (SAH) are employed. With the use of SF12, a generic health measure, the inequality indicator is reduced by a factor of ten. We show that the process of dichotomizing variables leads to such huge differences. Cardinalizing SAH by means of the SF12 leads to similar results to those with the pure SF12 measure. Employing generic health measures used with other populations like the Canadian HUI-III or the Finnish 15D to cardinalize SAH has a significant impact on the degree of inequality measured. Finally, by contrasting the physical health component of the SF12 to the unambiguously objective grip strength measure, we provide evidence of the presence of income-related reporting heterogeneity in generic health measures.Health measures Income-related health inequality Concentration index Reporting heterogeneity SF12 Grip strength German Socio -Economic Panel Study (SOEP) Germany