The effect of health on socioeconomic status: Using instrumental variables to revisit a successful randomized controlled trial


Poor health is widely recognized as a consequence of social disadvantage, but health problems may also help transmit social disadvantage over time and generations. Experimentally assigned health exposures, namely those tested in randomized controlled trials, may provide opportunities to estimate the causal effects of health on socioeconomic status (SES). We revisit data from the Diabetes Control and Complications Trial, a randomized controlled trial of glucose control therapy in Type 1 diabetic patients, and use treatment assignment as an instrument for health status to test the causal effect of treatment-related health improvement on subsequent SES measured during the trial’s follow-up study, the Epidemiology of Diabetes Interventions and Complications study. We used the Two-Factor Hollingshead Index of Social Position, which comprises education and occupation, to measure SES. Glycated hemoglobin (HbA1c) served as a proxy for health status. Ordinary least squares (OLS) regression models showed that lower HbA1c at the trial’s end was associated with higher SES at both the start of the follow-up and 17 years later. However, instrumental variable analyses showed no causal effect of HbA1c on SES, suggesting that OLS estimates are biased by endogeneity. Sensitivity analyses showed robustness to several alternate specifications. While the HbA1c advantage conferred by random assignment to treatment within the trial did not produce higher Hollingshead Index scores, we note that occupation and education categories may be harder to affect than are outcomes such as income. This analysis offers evidence that clinical trial data may be a rich and unrecognized resource for estimating health effects on SES.

Economics and Human Biology, 27(B)
Madeleine I. G. Daepp
Senior Researcher

Senior Researcher, Microsoft Research Urban Innovation Initiative