Income Inequality,Race,and Child Well-being: An Aggregate Analysis in the 50 United States ∗

Abstract

Interest in income inequality as a predictor of health has exploded since the mid-1990s. Recent analyses suggest, however, that the effect of income inequality on population health is not robust to a control for the racial composition of the population. That observation raises two interpretational questions. First, does income inequality have an independent effect on population health? Second, what does the effect of racial composition on population health mean? We use data from the Urban Institute's Assessing the New Federalism project and the Kids Count Databook to evaluate the aggregate effects of income inequality on diverse measures of child well-being (e.g., infant mortality, high school drop-out rates) in the 50 U.S. states. We replicate the finding that, net of the racial/ethnic composition of the population, the effects of income inequality are not significant. Moreover, the effects of racial composition on child well-being appear to be compositional (i.e., they reflect the less positive outcomes observed among racial/ethnic minorities) rather than contextual (i.e., representing the independent influence of social context). Whereas cross-level effects are still possible, our results cast doubt on the health relevance of these aggregate characteristics of the population.