5.2  Self-rated health

In each wave, respondents rated their own health. The means and medians of net wealth for each of the self-rated health categories are given in Table 8. In all categories the raw mean exceeds the median by more than $50,000. This is owing to the skewed distribution of wealth.

Source: SoFIE Waves 1–3, OSMs, longitudinal weights, supplied by Statistics New Zealand

Note:

1. The modified mean is calculated as the mean of the logarithms of net wealth and then transformed back (raised to the exponential power). This reduces the effect of outliers.

While there is no clear overall systematic relationship between net wealth and self-rated health, Table 8 suggests that those with poor health do in fact have lower net wealth. However, these results do not control for the possible effect of other variables, in particular age. The lower mean and median for those reporting excellent health will be influenced by the number of young people with low wealth.

5.2.1  Results from self-rated health

Self-rated health from Wave 2 was included in core models one and two. The results given in Table 9 show a progressive relationship with worse self-rated health being associated with lower net wealth. The marginal effects suggest that the relationship is stronger than was implied by the raw modified means; the difference between the raw modified means for very good and fair health is $1,800 and the difference between the marginal effects of very good and fair health is $21,950. Similarly, the difference between the raw modified means for excellent and poor health is $17,850 and the marginal effect of poor health is $46,150 (recall excellent health is the control).

Figure 4 shows net wealth declines systematically with worse self-rated health. For each core model the forecasted net wealth for an individual with the mean characteristics from the longitudinal population is given. In core model one, net wealth decreases from about $107,000 to just under $54,000 as health worsens from excellent to poor. In core model two, net wealth decreases from about $96,000 to just under $50,000.

The error bars provided in black give the ranges of forecasted net wealth for each health category if the corresponding coefficient is permitted to vary within its 95% confidence interval. The self-rated health coefficients are estimated with respect to excellent self-rated health, the error bars relate to the difference between excellent health and the corresponding category. They are not confidence intervals for the level of wealth by self-rated health.

Source: SoFIE Waves 1–3, OSMs, longitudinal weights, supplied by Statistics New Zealand

Notes:

1. *=coefficients are significant at the 10% significance level. **=coefficients are significant at the 5% significance level. ***=coefficients are significant at the 1% significance level.
2. Marginal effects ($) are calculated as the increase in net wealth for a change in the variable from the control with all other variables held at their mean.
3. Coefficient testing shows all coefficients are distinct at the 5% level. The coefficient for very good health is distinct from zero (zero is equivalent to excellent health, the control) at the 1% level.

Figure 4 – Levels of estimated net wealth by self-rated health

Source:  SoFIE Waves 1–3, OSMs, longitudinal weights, supplied by Statistics New Zealand

Note:

1. The error bars (given in black) are calculated by estimating the log of net wealth using the bounds on the 95% confidence interval for each coefficient. This estimate is then transformed to net wealth.
2. Despite the overlap between some of the error bars, the coefficients are distinct at the 5% level. Any apparent overlap will be a result of changing from a logarithmic scale during the estimation process.
3. The means given here are those predicted by the core models for a respondent with average characteristics. They differ from those means given in Table 9 as the latter are raw means rather than predicted means.