nep-hea New Economics Papers
on Health Economics
Issue of 2008‒05‒17
sixteen papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. Good Times Are Drinking Times: Empirical Evidence on Business Cycles an Alcohol Sales in Sweden 1861-2000 By Krüger, Niclas A; Svensson, Mikael
  2. Lifetime Health Consequences of Child Labor in Brazil By Lee, Chanyoung; Orazem, Peter
  3. Hepatitis B Does Not Explain Male-Biased Sex Ratios in China By Emily Oster; Gang Chen
  4. Healthy, Wealthy, and Wise Socioeconomic Status, Poor Health in Childhood, and Human Capital Development By Janet Currie
  5. Religion, Longevity, and Cooperation: The Case of the Craft Guild. By Gary Richardson; Michael McBride
  6. Have Newer Cardiovascular Drugs Reduced Hospitalization? Evidence From Longitudinal Country-Level Data on 20 OECD Countries, 1995-2003 By Frank R. Lichtenberg
  7. Pharmaceutical innovation and the longevity of Australians: a first look By Frank R. Lichtenberg; Gautier Duflos
  8. An Analysis of Mental Stress in Ireland, 1994-2000 By Madden, D
  9. Gender Differences in Mental Well- Being: A Decomposition Analysis By Madden, D
  10. Ordinal and Cardinal Measures of Health Inequality: An Empirical Comparison By Madden, D
  11. Optimal contracts and contractual arrangements within the hospital: bargaining vs. take-it-or-leave-it offers By Matteo Galizzi; Marisa Miraldo
  13. Less Social Health Insurance – More Private Supplementary Insurance? – Empirical Evidence from Germany By Boris Augurzky; Harald Tauchmann
  14. How Local is Hospital Treatment? An Exploratory Analysis of Public/Private Variation in Location of Treatment in Irish Acute Public Hospitals By Jacqueline O'Reilly; Miriam M. Wiley
  15. Perception of Excessive Drinking Among Irish College Students: A Mixed Methods Analysis By Liam Delaney; Colm Harmon; Claire Milner; Lorna Sweeney; Pat Wall
  16. Sheepskin or Prozac: The Causal Effect of Education on Mental Health By Arnaud Chevalier; Leon Feinstein

  1. By: Krüger, Niclas A (Department of Business, Economics, Statistics and Informatics); Svensson, Mikael (Department of Business, Economics, Statistics and Informatics)
    Abstract: This paper studies the relationship between the business cycle and alcohol sales in Sweden using a data set for the years 1861-2000. Using wavelet based band-pass filtering it is found that there is a pro-cyclical relationship, i.e. alcohol sales increases in short-term economic upturns. Using moving window techniques we see that the pro-cyclical relationship holds over the entire time period. We also find that alcohol sales are a long-memory process with non-stationary behavior, i.e. a shock in alcohol sales has persistent effects
    Keywords: Businesscycles:Alcohol:Sweden
    JEL: E32 I12
    Date: 2008–05–08
  2. By: Lee, Chanyoung; Orazem, Peter
    Abstract: The health consequences of child labor may take time to manifest themselves. This study examines whether adults who worked as children experience increased incidence of illness or physical disability. The analysis corrects for the likely endogeneity of child labor and years of schooling using variation across localities in the number of schools and teachers per child, and in low skill wages dated back to the time when the adults were children. Results show that the effects of child labor on adult health are complex. When child labor and schooling are treated as exogenous variables, child labor appears to increase the likelihood of poor health outcomes in adulthood across a wide variety of health measures. However, when child labor and schooling are considered endogenous, they lose power to explain adverse adult health outcomes in almost all cases. When analyzed separately for subsamples of males and females, the explanatory power of schooling and child labor completely disappears. Failing to find a causal link between child labor and adverse adult health outcomes, we conclude that the correlation between the two is related to unobservable health and ability endowments that jointly affect child labor supply, schooling, and adult health.
    Keywords: child labor; health; wages; schooling; school quality; occupational choice
    JEL: I0
    Date: 2008–05–12
  3. By: Emily Oster; Gang Chen
    Abstract: Earlier work (Oster, 2005) has argued, based on existing medical literature and analysis of cross country data and vaccination programs, that parents who are carriers of hepatitis B have a higher offspring sex ratio (more boys) than non-carrier parents. Further, since a number of Asian countries, China in particular, have high hepatitis B carrier rates, Oster (2005) suggested that hepatitis B could explain a large share { approximately 50% { of Asia's \missing women". Subsequent work has questioned this conclusion. Most notably, Lin and Luoh (2008) use data from a large cohort of births in Taiwan and find only a very tiny effect of maternal hepatitis carrier status on offspring sex ratio. Although this work is quite conclusive for the case of mothers, it leaves open the possibility that paternal carrier status is driving higher sex offspring sex ratios. To test this, we collected data on the offspring gender for a cohort of 67,000 people in China who are being observed in a prospective cohort study of liver cancer; approximately 15% of these individuals are hepatitis B carriers. In this sample, we find no effect of either maternal or paternal hepatitis B carrier status on offspring sex. Carrier parents are no more likely to have male children than non-carrier parents. This finding leads us to conclude that hepatitis B cannot explain skewed sex ratios in China.
    JEL: J1 J16
    Date: 2008–05
  4. By: Janet Currie
    Abstract: There are many possible pathways between parental education, income, and health, and between child health and education, but only some of them have been explored in the literature. This essay focuses on links between parental socioeconomic status (as measured by education, income, occupation, or in some cases area of residence) and child health, and between child health and adult education or income. Specifically, I ask two questions: What is the evidence regarding whether parental socioeconomic status affects child health? And, what is the evidence relating child health to future educational and labor market outcomes? I show that there is now strong evidence of both links, suggesting that health could play a role in the intergenerational transmission of economic status.
    JEL: I12 J24
    Date: 2008–05
  5. By: Gary Richardson; Michael McBride
    Abstract: When the mortality rate is high, repeated interaction alone may not sustain cooperation, and religion may play an important role in shaping economic institutions. This insight explains why during the fourteenth century, when plagues decimated populations and the church promoted the doctrine of purgatory, guilds that bundled together religious and occupational activities dominated manufacturing and commerce. During the sixteenth century, the disease environment eased, and the Reformation dispelled the doctrine of purgatory, necessitating the development of new methods of organizing industry. The logic underlying this conclusion has implications for the study of institutions, economics, and religion throughout history and in the developing world today.
    JEL: D02 D43 L1 L15 L2 L22 L23 N34 N64 N74 N84 N94 Z12
    Date: 2008–05
  6. By: Frank R. Lichtenberg
    Abstract: This study examines the effect of changes in the vintage distribution of cardiovascular system drugs on hospitalization and mortality due to cardiovascular disease using longitudinal country-level data. The vintage of a drug is the first year in which it was marketed anywhere in the world. We use annual data on the utilization of over 1100 cardiovascular drugs (active ingredients) in 20 OECD countries during the period 1995-2003. Countries with larger increases in the share of cardiovascular drug doses that contained post-1990 or post-1995 ingredients had smaller increases in the cardiovascular disease hospital discharge rate, controlling for the quantity of cardiovascular medications consumed per person, the use of other medical innovations (CT scanners & MRI units), potential risk factors (average consumption of calories, tobacco, and alcohol), and demographic variables (population size & age structure, income, and educational attainment). The estimates also indicate that use of newer cardiovascular drugs has reduced average length of stay and the age-adjusted cardiovascular mortality rate, but not the number of potential years of life lost due to cardiovascular disease before age 70 per 100,000 population. The estimates indicate that if drug vintage had not increased during 1995-2004, hospitalization and mortality would have been higher in 2004. We estimate that per capita expenditure on cardiovascular hospital stays would have been 70% ($89) higher in 2004 had drug vintage not increased during 1995-2004. Per capita expenditure on cardiovascular drugs would have been lower in 2004 had drug vintage not increased during 1995-2004. But our estimate of the increase in expenditure on cardiovascular hospital stays is about 3.7 times as large as our estimate of the reduction in per capita expenditure for cardiovascular drugs that would have occurred ($24).
    JEL: I12 O33 O51 O52 O56
    Date: 2008–05
  7. By: Frank R. Lichtenberg; Gautier Duflos
    Abstract: We examine the impact of pharmaceutical innovation on the longevity of Australians during the period 1995-2003. Due to the government's Pharmaceutical Benefits Scheme, Australia has much better data on drug utilization than most other countries. We find that mean age at death increased more for diseases with larger increases in mean drug vintage. The estimates indicate that increasing the mean vintage of drugs by 5 years would increase mean age at death by almost 11 months. The estimates also indicate that using newer drugs reduced the number of years of potential life lost before the ages of 65 and 70 (but not before age 75). During the period 1995-2003, mean age at death increased by about 2.0 years, from 74.4 to 76.4. The estimates imply that, in the absence of any increase in drug vintage, mean age at death would have increased by only 0.7 years. The increase in drug vintage accounts for about 65% of the total increase in mean age at death. We obtain a rough estimate of the cost per life-year gained from using newer drugs. Under our assumptions, using newer drugs (increasing drug vintage) increased life expectancy by 1.23 years and increased lifetime drug expenditure by $12,976; the cost per life-year gained from using newer drugs is $10,585. An estimate made by other investigators of the value of a statistical Australian life-year ($70,618) is 6.7 times as large as our estimate of the cost per life-year gained from using newer drugs. We discuss several reasons why our estimate of the cost per life-year gained from using newer drugs could be too high or too low.
    JEL: H51 I12 J11 O33 O56
    Date: 2008–05
  8. By: Madden, D
    Abstract: The General Health Questionnaire (GHQ) is frequently used as a measure of mental well-being with those people with values below a certain threshold regarded as suffering from mental stress. Comparison of mental stress levels across populations may then be sensitive to the chosen threshold. This paper uses stochastic dominance techniques to regardless of the threshold chosen. Decomposition techniques suggest that changes in the proportion unemployed and in the protective effect of income, education and marital status upon mental health were the principal factors underlying this fall.
    Keywords: GHQ, mental stress, dominance, decomposition.
    JEL: I12 I31 I32
    Date: 2008–04
  9. By: Madden, D
    Abstract: The General Health Questionnaire (GHQ) is frequently used as a measure of mental well-being. A consistent pattern across countries is that women report lower levels of mental well-being, as measured by the GHQ. This paper applies decomposition techniques to Irish data for 1994 and 2000 to examine the factors lying behind the gender differences in GHQ score. For both 1994 and 2000 about two thirds of the raw difference is accounted for by differences in characteristics, with employment status the single most important factor.
    Keywords: Mental Well-Being, decomposition, gender difference.
    JEL: I12 I31 I32
    Date: 2008–04
  10. By: Madden, D
    Abstract: When measuring health inequality using ordinal data, analysts typically must choose between indices specifically based upon ordinal data and more standard indices using ordinal data which has been transformed into cardinal data. This paper compares inequality rankings across a number of different approaches and finds considerable sensitivity to the choice between ordinal and cardinal based indices. There is relatively little sensitivity to the ethical choices made by the analyst in terms of the weight attached to different parts of the distribution.
    Keywords: Inequality, cardinal, ordinal.
    JEL: D63 I18 I31
  11. By: Matteo Galizzi (Centre for Health Economics, University of York, UK and University of Brescia, Italy); Marisa Miraldo (Centre for Health Economics, University of York)
    Abstract: We study the impact of different contractual arrangements within the hospital on the optimal contracts designed by third party payers when severity is hospital's private information. We develop a multi-issue bargaining process between doctors and managers within the hospital. Results are then compared with a scenario where doctors and managers decide independently by maximizing their own profit, with managers proposing to doctors a take-it-or leave-it offer. Results show that, when the cost of capital is sufficiently low, the informational rent arising on information asymmetry is higher in a set up where managers and doctors decide together through a strategic bargaining process than when they act as two decision-making units.
    Keywords: Strategic Bargaining; Optimal Contracts; Hospitals; Asymmetric Information
    JEL: I11 I18
    Date: 2008–05
  12. By: Priya Bhagowalia; Susan E. Chen; William A. Masters (Department of Agricultural Economics, College of Agriculture, Purdue University)
    Abstract: Malnutrition is manifested in various degrees of both underweight and overweight, with large differences and rapid changes in their prevalence and severity. This paper introduces a new approach to characterizing the distribution of a population’s nutritional status, to help analyze changes in that distribution over time and across countries. Our method draws on the poverty literature to construct Foster-Greer-Thorbecke measures for the incidence and severity of underand overweight, based on deviations in either direction from the median of a healthy population. We apply this median-based measure to the nutritional status of over 400,000 preschool children, as measured in 130 DHS surveys covering 53 countries over a period from 1986 to 2006. Unlike conventional threshold-based methods, the new approach counts changes in every child’s bodyweight. We find that this offers a more sensitive measure of differences across countries and changes over time, showing in particular that children’s bodyweights are closely linked to local agricultural output and gender equality as well as real GDP per capita.
    Keywords: Underweight, Overweight, Malnutrition, Poverty
    JEL: I12 Q18
    Date: 2008
  13. By: Boris Augurzky; Harald Tauchmann
    Abstract: This paper uses individual level data to analyze the effect of changes in the compulsory benefit package of the German statutory health insurance scheme on the demand for private supplementary insurance. In particular, we aim at measuring the effect of excluding dentures from the benefit package in 1997 as well as the effect of re-including them in 1999.Adifference-in-differences estimator is used. Individuals born prior to 1979 serve as control group because only the young were affected by the reform.Our results do not exhibit any significant effects on the demand for supplementary health insurance. Thus, the hypothesis that clients do make informed choices about their health insurances’ coverage is not supported.
    Keywords: Supplementary private health insurance, dentures, difference- indifferences
    JEL: I12 P23
    Date: 2008–05
  14. By: Jacqueline O'Reilly (Economic and Social Research Institute (ESRI)); Miriam M. Wiley (Economic and Social Research Institute (ESRI))
    Abstract: This paper undertakes an exploratory examination of the factors that affect where patients receive treatment from Irish acute public hospitals, with particular regard to the influence of patients’ public/private status. National univariate statistics indicate that private discharged patients are slightly more likely to be treated outside their county of residence than their public counterparts. A multivariate model necessarily estimated at the county level provides indirect support for this finding for the category of day patients, but not for planned and emergency in-patients. The effects of the other patient characteristics also varied across the three models, although there was consistency in the impact of supply-side factors, such as the type and availability of services. As there appears to be some tendency for private day patients to have a slightly greater propensity to travel for acute public hospital treatment, further research is required to identify the reasons for this, as well as the consequences for public and private patients resident in the source and destination counties.
    Date: 2008–05
  15. By: Liam Delaney (Senior Researcher, Geary Institute, University College Dublin); Colm Harmon (School of Economics & Geary Institute, University College Dublin); Claire Milner (DClin Programme Trinity College Dublin); Lorna Sweeney (Geary Institute, University College Dublin); Pat Wall (Geary Institute + School of Public Health & Population Science, University College Dublin)
    Abstract: This paper examines students’ perceptions of excessive drinking using statistical vignettes based on standard alcohol misuse markers used in the WHO Alcohol Use Disorders Identification Test (AUDIT). Quantitative analyses revealed stark heterogeneity in students’ perceptions of alcohol excess both in terms of their own self-rated excessiveness and in terms of their general conceptions of excessiveness. Interpretive Phenomenological Analysis (IPA) of focus group data with student drinkers revealed four themes mediating perception of excess: Perception of Normal Drinking; Perceived Indicators of Excess; Reactions to Alcohol Guidelines; Justifications for Excessive Alcohol Consumption.
    Keywords: Mixed Methods, Alcohol, Vignettes, Student Health, Focus Groups
    Date: 2007–05–08
  16. By: Arnaud Chevalier (Department of Economics, University of Kent, Canterbury, CT2 7NP, England Associate at the Centre for Economics of Education, London School of Economics, Geary Institute, University College Dublin & Institute for the Study of Labour, IZA, Bonn); Leon Feinstein (Institute of Education, Centre for Research on the Wider Benefits of Learning, 20 Bedford Way, London WC1H OAL, England Associate at the Centre for the Economics of Education, London School of Economics, England)
    Abstract: Mental illness is associated with large costs to individuals and society. Education improves various health outcomes but little work has been done on mental illness. To obtain unbiased estimates of the effect of education on mental health, we rely on a rich longitudinal dataset that contains health information from childhood to adulthood and thus allow us to control for fixed effects in mental health. We measure two health outcomes: malaise score and depression and estimate the extensive and intensive margins of education on mental health using various estimators. For all estimators, accounting for the endogeneity of education augments its protecting effect on mental health. We find that the effect of education is greater at mid-level of qualifications, for women and for individuals at greater risk of mental illness. The effects of education are observed at all ages, additionally education also reduces the transition to depression. These results suggest substantial returns to education in term of improved mental health.
    Keywords: Returns to education, mental health
    JEL: I12 I29
    Date: 2007–06–08

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