This paper contributes to the important policy related literature on income and health by providing a detailed investigation of the family income/child health relationship using matched parent–child survey data from the Swedish Survey of Living Conditions (ULF). This study differs from previous work in the field in a number of respects. First, we focus on both physical as well as on the psychosocial health of the child. Second, we focus on the parent’s socioeconomic background as well as on the liquidity constraint problems the household faces. We find little evidence of an income gradient or effect on children’s physical and psychosocial health. However, our study suggests that the occurrence of liquidity constraints in the household increases the likelihood of the child having a lower psychosocial health status.child health; income gradient; liquidity constraint; psychosocial health
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