nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2014‒08‒28
three papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. Do Elderly Choose Nursing Homes by Quality, Price or Location? By Hendrik Schmitz; Magdalena Stroka
  2. The Willingness to Pay for a QALY: a Review of the Empirical Literature By Ryen, Linda; Svensson, Mikael

  1. By: Hendrik Schmitz; Magdalena Stroka
    Abstract: Quality report cards addressing information asymmetry in the health care market have become a popular strategy used by policymakers to improve the quality of care for elderly. Using individual level data from the largest German sickness fund merged with institutional level data, we examine the relationship between nursing home quality, as measured by recently introduced report cards, nursing home prices, nursing home’s location and the individual choice of nursing homes. Report cards were stepwise introduced as of 2009 and we use a sample of 2010 that includes both homes that had been evaluated at that time and that had not yet been. Thus, we can distinguish between institutions with good and bad ratings as well as non-rated nursing homes. We find that the probability of choosing a nursing home decreases in distance and price. However, we find no significant effect of reported quality on individuals’ choice of nursing homes.
    Keywords: Nursing home choice; quality report cards; quality information; demand
    JEL: I10
    Date: 2014–07
  2. By: Ryen, Linda (Dept. of Economics); Svensson, Mikael (Dept. of Economics)
    Abstract: There has been a rapid increase in the use of cost-effectiveness analysis, with Quality Adjusted Life Years (QALYs) as an outcome measure, in evaluating both medical technologies and public health interventions. Alongside, there is a growing literature on the monetary value of a QALY based on estimates of the willingness to pay (WTP). This paper conducts a review of the literature on the WTP for a QALY. In total 24 studies containing 383 unique estimates of the WTP for a QALY are identified. Trimmed mean and median estimates amount to 74,159 and 24,226 Euros (2010 price level), respectively. In regression analyses the results indicate that the WTP for a QALY is significantly higher if the QALY gain comes from life extension rather than quality of life improvements. The results also show that the WTP for a QALY is dependent on the size of the QALY gain valued.
    Keywords: QALY; Willingness to pay; Literature Review
    JEL: D61 H51 I18
    Date: 2014–07–28
  3. By: Bogdan Nedanov (Department of Economics,University of Delaware); Charles R. Link (Department of Economics,University of Delaware)
    Abstract: The objective is to estimate the effect on one’s weight decades later of choosing a blue collar job as his/her initial job. OLS and probit models are estimated, using dummy variables for overweight and obesity as the dependent variables. Various two stage models treat occupational choice to be endogenous. Using strong instrumental variables to identify occupational choice, yields statistically significant results indicating that the initial choice of a blue collar job is associated with an increase of 6.6% (4.8%) in the probability of being overweight (obese). We also find that an additional year of blue collar work is associated with an increase of 1.1% and 1.4% in the probability of being overweight and obese, respectively.
    Keywords: occupational choice; obesity; initial blue collar jobs; strong instruments; health general
    JEL: I10 I12 I13 I19 J24
    Date: 2014

This nep-dcm issue is ©2014 by Edoardo Marcucci. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.