It is a truism that poverty is bad for health. Relative as well as absolute forms of poverty are associated with adverse health outcomes. Yet the precise links between financial circumstances and health are not well understood. In part this is because most analyses of income and health are based on data collected at a single point in time. What is actually required is information that monitors changes in an individual's circumstances. Although some people face long periods of sustained financial hardship, a large number of others move into and out of poverty in various ways and for differing periods of time. These kinds of income dynamics, as they are termed, may have important implications for health outcomes. For example, are long periods of time spent living on a low income more or less damaging to health than very large but temporary reductions in income? Or are there specific stages of the life course, like childhood, when low levels of income are particularly harmful for health prospects? The purpose of this project is to investigate these and similar questions in a British context. The Project has three aims: to develop a theoretical framework that can account for the observed links between levels of, and changes in, income and health; to investigate the effects of both short-term fluctuations in income and longer-term measures of more 'permanent' income on different dimensions of health, using longitudinal datasets and appropriate econometric and social policy implications of the relationship between income and health.