nep-hea New Economics Papers
on Health Economics
Issue of 2008‒07‒14
seventeen papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. Socio-Economic Status, HIV/AIDS Knowledge and Stigma, and Sexual Behavior in India By Pedro de Araujo
  2. Adult height and childhood disease By Carlos Bozzoli; Angus Deaton; Climent Quintana
  3. A macroeconomic analysis of obesity By Pere Gomis-Porqueras; Adrian Peralta-Alva
  4. Semiparametric surveillance of outbreaks By Frisén, Marianne; Andersson, Eva
  5. Semiparametric estimation of outbreak regression By Frisén, Marianne; Andersson, Eva; Pettersson, Kjell
  6. A Two-Stage Estimation of Hospital Performance Using Mortality Outcome Measures: An Application Using Victorian Hospital Data By Chew Lian Chua; Alfons Palangkaraya; Jongsay Yong
  7. The Effects of Health and Health Shocks on Hours Worked By Cai, Lixin; Mavromaras, Kostas G.; Oguzoglu, Umut
  8. Fertility in Sub-Saharan African Countries with Consideration to Health and Poverty By Jeon, Yongil; Rhyu, Sang-Young; Shields, Michael P.
  9. Intergenerational Transmission of Healthy Eating Behaviour and the Role of Household Income By Goode, Alison; Mavromaras, Kostas G.; Smith, Murray
  10. Education, Information, and Improved Health: Evidence from Breast Cancer Screening By Chen, Keith; Lange, Fabian
  11. Anatomy of a Health Scare: Education, Income and the MMR Controversy in the UK By Anderberg, Dan; Chevalier, Arnaud; Wadsworth, Jonathan
  12. Optimal Health and Retirement Policies amid Population Aging By Gisela Hostenkamp; Michael Stolpe
  13. Consumer-Directed Health Care: Can Consumers Look After Themselves? By McFadden, Daniel; Winter, Joachim; Heiss, Florian
  14. Family Leave after Childbirth and the Health of New Mothers By Pinka Chatterji; Sara Markowitz
  15. The Value of Life in General Equilibrium By Anupam Jena; Casey Mulligan; Tomas J. Philipson; Eric Sun
  16. Influence, Information Overload, and Information Technology in Health Care By James B. Rebitzer; Mari Rege; Christopher Shepard
  17. Has Public Health Insurance for Older Children Reduced Disparities in Access to Care and Health Outcomes? By Janet Currie; Sandra Decker; Wanchuan Lin

  1. By: Pedro de Araujo (Indiana University Bloomington)
    Abstract: Using data from the National Family Health Surveys (NFHS-3), this paper analyzes the socioeconomic correlates of sexual behavior, HIV/AIDS knowledge and stigma in India. The main findings are that, overall, the Indian population is faithful and abstains from sex with very small variations across socioeconomic classes. However, given the large size of the population, there is still room for some concern as condom use is low, knowledge about the disease is poor, and stigma is high; especially with respect to less educated, poorer, single males and women in general. Obvious policy recommendations are; therefore, to increase condom distribution and awareness, increase very heavily HIV/AIDS basic education, and promote women empowerment with respect to sexual choices.
    Keywords: HIV/AIDS, Condom, Stigma, India
    JEL: C13 C25 O53
    Date: 2008–07
  2. By: Carlos Bozzoli; Angus Deaton; Climent Quintana
    Abstract: Taller populations are generally richer populations, and taller individuals live longer and earn more, perhaps reflecting their superior cognitive abilities. Understanding the determinants of adult height has thus become a focus in understanding the relationship between health and wealth. We investigate the childhood determinants of adult height in populations, focusing on the respective roles of income and of disease. Across a range of European countries and the United States, we find a strong inverse relationship between postneonatal (one month to one year) mortality, interpreted as a measure of the disease and nutritional burden in childhood, and the mean height of those children as adults. In pooled birth-cohort data over 31 years for the United States and eleven European countries, postneonatal mortality in the year of birth accounts for more than 60 percent of the combined cross-country and cross-cohort variation in adult heights. The estimated effects are smaller but remain significant once we allow for country and birth-cohort effects. The decline in postneonatal mortality from 1950 to 1980 can account for almost all of the increase in adult height for those born in those years, and explains 20 to 30 percent of the 2 cm shortfall of 30 yearold Americans relative to 30-year old Swedes in 2000. Consistent with these findings, we develop a model of selection and stunting, in which the early life burden of nutrition and disease is not only responsible for mortality in childhood but also leaves a residue of long-term health risks for survivors, risks that express themselves in adult height, as well as in late-life disease. The model predicts that, at sufficiently high mortality levels, selection can dominate scarring, leaving a taller population of survivors. We find evidence of this effect in the poorest and highest mortality countries of the world, supplementing recent findings on the effects of the Great Chinese famine.
    Date: 2008–07
  3. By: Pere Gomis-Porqueras; Adrian Peralta-Alva
    Abstract: This paper tries to understand the underlying causes of the rapid increase in obesity rates over recent decades. In particular, we propose a dynamic general equilibrium model to derive the quantitative implications of a decline in the relative (monetary and time) cost of food prepared away from home on the caloric intake of the average American adult over the last forty years. Two channels that lower this relative cost are considered. First, productivity improvements in the production of food prepared away from home. We and that this channel is qualitatively consistent with expenditure trends in food items, but falls short of accounting for the magnitude of the observed changes. We then consider actual declines in income taxes and in the gender wage gap, which increase the cost of preparing food at home from scratch. Our model accounts for three quarters of the observed changes in calorie consumption, and is consistent with trends in aggregate food expenditures, time use, and key macroeconomic variables. Our results indicate that changes in the relative cost of food prepared away from home play an important role in our understanding of the increased weight of the American population during the last 40 years.
    Keywords: Obesity
    Date: 2008
  4. By: Frisén, Marianne (Statistical Research Unit, Department of Economics, School of Business, Economics and Law, Göteborg University); Andersson, Eva (Statistical Research Unit, Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: The detection of a change from a constant level to a monotonically increasing (or decreasing) regression is of special interest for the detection of outbreaks of, for example, epidemics. A maximum likelihood ratio statistic for the sequential surveillance of an “outbreak” situation is derived. The method is semiparametric in the sense that the regression model is nonparametric while the distribution belongs to the regular exponential family. The method is evaluated with respect to timeliness and predicted value in a simulation study that imitates the influenza outbreaks in Sweden. To illustrate its performance, the method is applied to Swedish influenza data for six years. The advantage of this semiparametric surveillance method, which does not rely on an estimated baseline, is illustrated by a Monte Carlo study. The proposed method is successively accumulating the information. Such accumulation is not made by the commonly used approach where the current observation is compared to a baseline. The advantage of information accumulation is illustrated.
    Keywords: Monitoring; Change-points; Generalised likelihood; Ordered regression; Robust regression; Exponential family
    JEL: C10
    Date: 2008–02–04
  5. By: Frisén, Marianne (Statistical Research Unit, Department of Economics, School of Business, Economics and Law, Göteborg University); Andersson, Eva (Statistical Research Unit, Department of Economics, School of Business, Economics and Law, Göteborg University); Pettersson, Kjell (Statistical Research Unit, Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: A regression may be constant for small values of the independent variable (for example time), but then a monotonic increase starts. Such an “outbreak” regression is of interest for example in the study of the outbreak of an epidemic disease. We give the least square estimators for this outbreak regression without assumption of a parametric regression function. It is shown that the least squares estimators are also the maximum likelihood estimators for distributions in the regular exponential family such as the Gaussian or Poisson distribution. The approach is thus semiparametric. The method is applied to Swedish data on influenza, and the properties are demonstrated by a simulation study. The consistency of the estimator is proved.
    Keywords: Constant Base-line; Monotonic change; Exponential family
    JEL: C10
    Date: 2008–02–04
  6. By: Chew Lian Chua (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Alfons Palangkaraya (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Jongsay Yong (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)
    Abstract: This paper proposes a method of deriving a hospital quality performance indicator using mortality outcome measures. The method aggregates any number of mortality outcome measures observed over several years into a single indicator. We begin with the supposition that there exists an abstract quality index which drives all observed mortality outcomes in each hospital. This abstract index is not directly observable but manifested via the observed mortality outcomes, which we make use of to provide an estimate of the abstract index. The method is applied to a sample of heart disease episodes extracted from hospital administrative data from the state of Victoria, Australia. Using the quality estimates, we show that teaching hospitals and large regional hospitals perform better than other hospitals and this superior performance is related to hospital size.
    Date: 2008–07
  7. By: Cai, Lixin (Melbourne Institute of Applied Economic and Social Research); Mavromaras, Kostas G. (University of Melbourne); Oguzoglu, Umut (Melbourne Institute of Applied Economic and Social Research)
    Abstract: We investigate the impact of health on working hours in recognition of the fact that leaving the labour market due to persistently low levels of health stock or due to new health shocks, is only one of the possibilities open to employees. We use the first six waves of the HILDA survey to estimate the joint effect of health status and health shocks on working hours using a dynamic random effects Tobit model of working hours to account for zero working hours. We follow Heckman (1981) and approximate the unknown initial conditions with a static equation that utilizes information from the first wave of the data. Predicted individual health stocks are used to ameliorate the possible effects of measurement error and endogeneity. We conclude that overall lower health status results in lower working hours and that health shocks lead to further reductions in working hours when they occur. Estimation results show that the model performs well in separating the time-persistent effect of health stock (health status) and the potentially more transient health shocks on working hours.
    Keywords: health shocks, health, working hours, Tobit estimation
    JEL: J22 I10 C33
    Date: 2008–05
  8. By: Jeon, Yongil (Central Michigan University); Rhyu, Sang-Young (Yonsei University); Shields, Michael P. (Central Michigan University)
    Abstract: Fertility has begun to fall in Sub-Saharan Africa but it remains high on average and particularly for a few countries. This paper examines African fertility using a panel data set of 47 Sub-Saharan countries between 1962 and 2003. Fixed and random country effect estimates are made in models where the explanatory variables are suggested by the theory of the demographic transition as modified by Caldwell. Special attention is paid to the economic status of women, urbanization, the poverty level, and the health of the population including total health expenditures and the prevalence of HIV/AIDS. The results support Caldwell’s hypothesis and are generally supportive of hypothesis that a fertility transition is occurring. HIV/AIDS is found to have a negative impact on fertility.
    Keywords: Africa, infant mortality, fertility, poverty, health
    JEL: J13 O10 O55
    Date: 2008–06
  9. By: Goode, Alison (Melbourne Institute of Applied Economic and Social Research); Mavromaras, Kostas G. (University of Melbourne); Smith, Murray (University of Aberdeen)
    Abstract: This paper investigates the possibility of intergenerational transmission of unhealthy eating habits from parents to adult children. It uses the 2003 Scottish Health Survey and estimates the association between the present healthy eating behaviour of adult children and the past parental death from cardiovascular disease (CVD). It uses parental CVD death as an adverse health signal which may cause a healthy eating compensatory response in adult children. This response is due to increased chances and perception of genetic predisposition of adult children as well as an indicator for parental past unhealthy eating habits which may have been passed onto the adult children. Regression analysis suggests that paternal history has no impact on either sons or daughters, and maternal history influences negatively the eating behaviour of daughters only. Unhealthy eating intergenerational transmission appears to be more intense amongst lower household income individuals.
    Keywords: intergenerational transmission, healthy eating, household income, cardiovascular disease, public health, gender
    JEL: D1 I12 I18 J16
    Date: 2008–06
  10. By: Chen, Keith (Yale University); Lange, Fabian (Yale University)
    Abstract: While it is well known that education strongly predicts health, less is known as to why. One reason might be that education improves health-care decision making. In this paper we attempt to disentangle improved decision making from other effects of education, and to quantify how large an impact it has on both a patient’s demand for health services, and that demand’s sensitivity to objective risk factors. We do this by estimating a simple structural model of information acquisition and health decisions for data on women’s self-reported breast-cancer risk and screening behavior. This allows us to separately identify differences in the ability to process health information and differences in overall demand for health. Our results suggest that the observed education gradient in screening stems from a higher willingness-to-pay for health among the educated, but that the main reason why the educated respond more to risk factors in their screening decision is because they are much better informed about the risk factors they face.
    Keywords: education, allocative efficiency, health
    JEL: I10 I12 I20 D83
    Date: 2008–06
  11. By: Anderberg, Dan (Royal Holloway, University of London); Chevalier, Arnaud (Royal Holloway, University of London); Wadsworth, Jonathan (Royal Holloway, University of London)
    Abstract: One theory for why there is a strong education gradient in health outcomes is that more educated individuals more quickly absorb new information about health technology. The MMR controversy in the UK provides a case where, for a brief period of time, some highly publicized research suggested that a particular multi-component vaccine, freely provided to young children, could have potentially serious side-effects. As the controversy set in, uptake of the MMR vaccine by more educated parents decreased significantly faster than that by less educated parents, turning a significant positive education gradient into a negative one. The fact that the initial information was subsequently overturned and the decline in uptake ceased suggests that our results are not driven by other unrelated trends. Somewhat puzzling, more educated parents also reduced their uptake of other non-controversial childhood vaccines. As an alternative to the MMR, parents may purchase single vaccines privately; the MMR is the only vaccine for which we observe a strong effect of income on uptake.
    Keywords: childhood vaccinations, health outcomes, education
    JEL: H31 I38 J12
    Date: 2008–07
  12. By: Gisela Hostenkamp; Michael Stolpe
    Abstract: This paper develops a simple analytical framework in which optimal health and retirement policies amid population aging can be discussed. To be efficient, these policies must recognize and exploit the dynamic complementarities between the timing of retirement, the size of lifecycle labour income and pension payments and investments in health that individuals make, for example, by purchasing medical care and that society makes by advancing medical technology. We aim to show how the traditionally separate areas of health and retirement policy can be coordinated to achieve dynamic efficiency. Under fairly general assumptions, postponing the age of retirement and greater health spending are shown to be complements in the maximization of lifecycle utility. Mandatory retirement and pension policies that change the constraints workers face can be used to induce voluntary health investments by individuals and improve society’s incentives to adopt new medical technology. Leaving a hitherto optimal mandatory retirement age unchanged as new medical technologies improve the efficacy of healthcare would be inefficient. The aggregate ability and willingness to pay for medi¬cal care and technology will be greater, the higher an economy’s per capita income, suggesting large welfare gains from postponing the average age of retirement if investments in new medical technology target the quality of life and raise the produc¬tivity of people working past a long-established mandatory retirement age
    Keywords: Medical technology, Longevity, Health policy, Retirement age
    JEL: I12 I18 J26
    Date: 2008–06
  13. By: McFadden, Daniel; Winter, Joachim; Heiss, Florian
    Abstract: In health care systems today, including those of Switzerland and the United States, participants do not necessarily see the big picture of lifetime health costs and quality of life, and in many systems consumers and providers lack the incentives to manage preventative and chronic care to minimize lifetime private and social health costs. Resource allocation problems induced by asymmetric information and misaligned incentives are exacerbated if consumers fail to have the acuity or perspective needed to make choices consistent with their self-interest when faced with complex health care choices with ambiguous future consequences. This paper examines rationality of consumers’ health perceptions and choices using as a natural experiment the recent introduction in the United States of a highly subsidized market for prescription drug insurance, and draws lessons from this experiment on the practicality of “Consumer Directed Health Care” as an approach to achieving efficient allocation of health care resources by confronting consumers with the full marginal costs of the services they use.
    Keywords: prescription drugs; health insurance; Medicare Part D
    JEL: I10 D12 H51
    Date: 2008–07–07
  14. By: Pinka Chatterji; Sara Markowitz
    Abstract: In the United States, almost a third of new mothers who worked during pregnancy return to work within three months of childbirth. Current public policies in the U.S. do not support long periods of family leave after childbirth, although some states are starting to change this. As such, it is vital to understand how length of family leave during the first year after childbirth affects families' health and wellbeing. The purpose of this paper is to examine the association between family leave length, which includes leave taking by mothers and fathers, and behavioral and physical health outcomes among new mothers. Using data from the Early Childhood Longitudinal Study - Birth Cohort, we examine measures of depression, overall health status, and substance use. We use a standard OLS as well as an instrumental variables approach with county-level employment conditions and state-level maternity leave policies as identifying instruments. The results suggest that longer maternity leave from work, both paid and un-paid, is associated with declines in depressive symptoms, a reduction in the likelihood of severe depression, and an improvement in overall maternal health. We also find that having a spouse that did not take any paternal leave after childbirth is associated with higher levels of maternal depressive symptoms. We do not find, however, that length of paternal leave is associated with overall maternal health, and we find only mixed evidence that leave length after childbirth affects maternal alcohol use and smoking.
    JEL: I0 J08
    Date: 2008–07
  15. By: Anupam Jena; Casey Mulligan; Tomas J. Philipson; Eric Sun
    Abstract: Perhaps the most important change of the last century was the great expansion of life itself -- in the US alone, life expectancy increased from 48 to 78 years. Recent economic estimates confirm this claim, finding that the economic value of the gain in longevity was on par with the value of growth in material well-being, as measured by income per capita. However, ever since Malthus, economists have recognized that demographic changes are linked to economic behavior and vice versa. Put simply, living with others who live 78 years is different than living with others who live only 48 years, so that valuing the extra 30 years of life is not simply a matter of valuing the extra years a single individual lives. The magnitude by which such valuations differ is overstated when there are increasing returns to population and is understated under decreasing returns. Focusing on the gains in life expectancy in the United States from 1900 to 2000, we find that a significant part of the value of longer life may be affected by these general equilibrium demographic effects.
    JEL: I1 I10 I31 J1 J17 O1
    Date: 2008–07
  16. By: James B. Rebitzer; Mari Rege; Christopher Shepard
    Abstract: We investigate whether information technology can help physicians more efficiently acquire new knowledge in a clinical environment characterized by information overload. Our analysis makes use of data from a randomized trial as well as a theoretical model of the influence that information technology has on the acquisition of new medical knowledge. Although the theoretical framework we develop is conventionally microeconomic, the model highlights the non-market and non-pecuniary influence activities that have been emphasized in the sociological literature on technology diffusion. We report three findings. First, empirical evidence and theoretical reasoning suggests that computer based decision support will speed the diffusion of new medical knowledge when physicians are coping with information overload. Secondly, spillover effects will likely lead to "underinvestment" in this decision support technology. Third, alternative financing strategies common to new information technology, such as the use of marketing dollars to pay for the decision support systems, may lead to undesirable outcomes if physician information overload is sufficiently severe and if there is significant ambiguity in how best to respond to the clinical issues identified by the computer.
    JEL: D01 D8 I12 L86
    Date: 2008–07
  17. By: Janet Currie; Sandra Decker; Wanchuan Lin
    Abstract: This paper investigates the effects of expanding public health insurance eligibility for older children. Using data from the National Health Interview Surveys from 1986 to 2005, we first show that although income continues to be an important predictor of children’s health status, the importance of income for predicting health has fallen for children 9 to 17 in recent years. We then investigate the extent to which the dramatic expansions in public health insurance coverage for these children in the past decade are responsible for the decline in the importance of income. We find that while eligibility for public health insurance unambiguously improves current utilization of preventive care, it has little effect on current health status. However, we find some evidence that Medicaid eligibility in early childhood has positive effects on future health. This may indicate that adequate medical care early on puts children on a better health trajectory, resulting in better health as they grow.
    JEL: I11 I12
    Date: 2008–07

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