Causal Effect of Health on Socio-Economic Prosperity: Experimental Evidence

Duncan Thomas, University of California, Los Angeles
Elizabeth Frankenberg, University of California, Los Angeles
Jed Friedman, World Bank Group
Christopher McKelvey, University of California, Los Angeles
Bondan Sikoki, SurveyMETER
Wayan Suriastini, Gadjah Mada University

Studies have demonstrated that health and socio-economic success are positively correlated. Identifying the causal effect of health on socio-economic success has proved to be extremely difficult. An on-going large scale random-assignment treatment-control experiment designed to pin down the extent to which one dimension of health – iron status – has a causal impact on an array of indicators of economic and social prosperity is described. The Work and Iron Status Evaluation follows 10,000 adults in Central Java, Indonesia. Half the respondents receive a weekly iron supplement for a year; the controls receive a placebo. Strategies to assure compliance with the protocols are described and compliance is also measured by monitoring blood iron levels during the study. Relative to controls, treated subjects who were iron deficient at baseline have elevated blood iron when supplementation ended. They also earned more (if they were self-employed), reported themselves as being in better physical and psycho-social health.