542. Avoiding Blindness to Health Status in Health Achievement and Health Inequality Measurement

Paul Makdissi, Myra Yazbeck, School of Economics Discussion Paper No. 542 April 2015, School of Economics, The University of Queensland, Department of Economics, University of Ottawa.

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Abstract

This paper argues that health transfers from an individual at a lower rank in the health distribution to a person at a higher rank may decrease the concentration index if the former has a slightly higher income. The concentration index, being mainly focused on the socioeconomic dimension of health inequality, can produce such counter-intuitive results that overlooks the pure health inequality aversion of the planner. Building on Atkinson (1970), Yitzhaki (1983) and Wagstaff (2002), this paper presents a simple new class of health achievement and health inequality indices that overcomes the above mentioned problem.