Disentangling the impacts of circumstances and efforts on health inequality: the case of Luxembourg

This paper attempts to determine the contribution of circumstances, efforts (and lifestyle) and demographic variables (age and gender) to inequality in health in Luxembourg. Health is measured subjectively by self-assessed health and is considered first as a binary variable, then as an ordinal variable. The educational level of each parent, the financial situation of the family during childhood and the area of birth are considered as circumstances while effort and lifestyle variables are proxied by information on the educational level of the individual, whether he/she smoked and whether he/she had a physical activity on a regular basis. The respective impacts of the three categories of explanatory variables (circumstances, effort and demographic variables) on health inequality are derived via a Shapley decomposition of the pseudo R-square of logit regressions. Differences in circumstances and effort and lifestyle explain each around a quarter of the pseudo R-square.