nep-hea New Economics Papers
on Health Economics
Issue of 2010‒07‒24
25 papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. Waiting times and the decision to buy private health insurance. CHERE Working Paper 2010/9 By Meliyanni Johar; Glenn Jones; Michael Keane; Elizabeth Savage; Olena Stavrunova
  2. Joiners and leavers stayers and abstainers: Private health insurance choices in Australia By Stephanie Knox; Elizabeth Savage; Denzil Fiebig; Vineta Salale
  3. General Practitioners knowledge, views and practices regarding cervical cancer screening in Australia. CHERE Working Paper 2010/6 By Stephen Goodall; Marion Haas; Rosalie Viney
  4. Differences in waiting times for elective admissions in NSW public hospitals: A decomposition analysis by non-clinical factors. CHERE Working Paper 2010/7 By Meliyanni Johar; Glenn Jones; Michael Keane; Elizabeth Savage; Olena Stavrunova
  5. The demand for private health insurance: do waiting lists or waiting times matter? CHERE Working Paper 2010/8 By Meliyanni Johar; Glenn Jones; Michael Keane; Elizabeth Savage; Olena Stavrunova
  6. Reducing the use of ineffective health care interventions. CHERE Working Paper 2010/5 By Gisselle Gallego; Marion Haas; Jane Hall; Rosalie Viney
  7. Investigating the Relationship between Health and Economic Growth: Empirical Evidence from a Panel of 5 Asian Countries By Seema Narayan; Paresh Kumar Narayan; Sagarika Mishra
  8. Global Climate Change and the Resurgence of Tropical Disease: An Economic Approach By Gollin, Douglas; Zimmermann, Christian
  9. Natural disasters and informal risk sharing against illness: networks vs. groups By Yoshito Takasaki
  10. The incentive for prevention in public health Systems By Renaud Bourlès
  11. Body size and wages in Europe: A semi-parametric analysis By HILDEBRAND Vincent; VAN KERM Philippe
  12. Bridging the Gap: Improving Clinical Development and the Regulatory Pathways for Health Products for Neglected Diseases By Thomas J. Bollyky
  13. The Role of the District Public Health Nurses: A Study from Gujarat By Bharati Sharma; Dileep Mavalankar; Pallavi Ranjan; Poonam Trivedi; Sweta Roy
  14. The Health Care Industry in the Nashville MSA: Its Scope and Impact on the Regional Economy By Murat Arik
  15. Context and the VSL: Evidence from a Stated Preference Study in Italy and the Czech Republic By Anna Alberini; Milan Šcasný, Charles University Prague
  16. The Virgin HIV Puzzle: Can Misreporting Account for the High Proportion of HIV Cases in Self-Reported Virgins? By Eva Deuchert
  17. Disability risk, disability insurance and life cycle behavior By Hamish Low; Luigi Pistaferri
  18. Who Wants to Work in a Rural Health Post? The Role of Intrinsic Motivation, Rural Background and Faith-Based Institutions in Rwanda and Ethiopia By Pieter Serneels; Jose G. Montalvo; Gunilla Pettersson; Tomas Lievens; Jean Damascene Butera; Aklilu Kidanu
  19. Parental Education and Child Health - Understanding the Pathways of Impact in Pakistan By Monazza Aslam; Geeta Kingdon
  20. Selective Mortality or Growth after Childhood? What Really is Key to Understand the Puzzlingly Tall Adult Heights in Sub-Saharan Africa By Alexander Moradi
  21. Health, Nutrition and Academic Achievement: New Evidence from India By Geeta Kingdon
  22. Intrinsic motivations and the non-profit health sector: Evidence from Ethiopia By Danila Serra; Pieter Serneels; Abigail Barr
  23. Discounting future pain: Effects on self-reported pain. By Pablo Brañas Garza; María Paz Espinosa; María Repolles Pro
  24. Death by Market Power: Reform, Competition and Patient Outcomes in the National Health Service By Martin Gaynor; Rodrigo Moreno-Serra; Carol Propper
  25. What Does Health Reform Mean for the Healthcare Industry? Evidence from the Massachusetts Special Senate Election By Mohamad Al-Ississ; Nolan H. Miller

  1. By: Meliyanni Johar (CHERE, University of Technology, Sydney); Glenn Jones; Michael Keane; Elizabeth Savage; Olena Stavrunova
    Abstract: Over 45% of Australians buy health insurance for private treatment in hospital. This is despite having access to universal and free public hospital treatment. Anecdotal evidence suggests that one possible explanation for the high rate of insurance coverage is to avoid long waiting times for public hospital treatment. In this study, we investigate the effect of expected waiting time on individual decisions to buy private health insurance. Individuals are assumed to form an expectation of their own waiting time as a function of their demographics and health status. We estimate models of expected waiting time using administrative data on the population hospitalised for elective procedures in public hospitals in 2004-05 and use the parameter estimates to impute expected waiting times for individuals in a representative sample of the population. We model the impact of expected waiting time on the decision to purchase private health insurance. In the insurance demand model, cross-sample predictions are adjusted by the individualsÂ’ probability of hospital admission. We find that expected waiting time does not increase the probability of buying insurance but a high probability of experiencing a long wait does. Overall we find there is no significant impact of waiting time on insurance purchase. In addition, we find that the inclusion of individual waiting time variables removes the evidence for favourable selection into private insurance, as measured by self-assessed health. This result suggests that a source of the favourable selection by reported health status may be aversion to long waits among healthier people.
    Keywords: Private health insurance, Australia
    JEL: I11 J7 H51
    Date: 2010–05
  2. By: Stephanie Knox (CHERE, University of Technology,Sydney); Elizabeth Savage (CHERE, University of Technology,Sydney); Denzil Fiebig; Vineta Salale
    Abstract: The percentage of Australians taking up Private Health Insurance (PHI) was in decline following the introduction of Medicare in 1984 (PHIAC). To arrest this decline the Australian Government introduced a suite of policies, between 1997 and 2000, to create incentives for Australians to purchase private health insurance. These policies include an increased Medicare levy for those without PHI on high incomes, introduced in 1997, a 30% rebate for private hospital cover (introduced 1998), and the Lifetime Health Cover (LHC) policy where PHI premiums are set at age of entry, increasing for each year older than 30 years (introduced 2000). In 2004 the longitudinal study on Household Income and Labour Dynamics in Australia (HILDA), included a series of questions on private health insurance and hospital use. We used the HILDA data to investigate the demographic, health and income factors related to the PHI decisions, especially around the introduction of the Lifetime Health Cover policy. Specifically we investigate who was most influenced to purchase PHI (specifically hospital cover) in 2000 as a response to the Lifetime Health Cover policy deadline. Are those who have joined PHI since the introduction of LHC different from those who joined prior to LHC? What are the characteristics of those who have dropped PHI since the introduction of LHC? We model the PHI outcomes allowing for heterogeneity of choice and correlation across alternatives. After controlling for other factors, we find that LHC prompted moderately well-off working age adults (30-49 yrs) to purchase before the 2000 deadline. Young singles or couples with no children, and the overseas born were more likely to purchase since 2000, while the relatively less well-off continue to drop PHI in spite of current policy incentives.
    Keywords: private health insurance, incentives, Australia
    JEL: I10
    Date: 2010–02
  3. By: Stephen Goodall (CHERE, University of Technology, Sydney); Marion Haas (CHERE, University of Technology, Sydney); Rosalie Viney (CHERE, University of Technology, Sydney)
    Abstract: Objective General practitioners (GPs) are the main providers of cervical screening in Australia and are crucial to the successful implementation of the National Cervical Screening Program (NCSP). This study assesses the views of GPs about the value of the Pap smear tests, their knowledge of the current screening policy, awareness of new technologies and concerns of litigation. Design A postal survey was conducted of a random sample of GPs in New South Wales, Australia. Results GPs are generally supportive of NCSP guidelines, specifically 88.5% now agree with the recommended 2 year screening interval. However, half believe the age range should be enlarged to include both older and younger patients. There are notable differences in knowledge and views between male and female GPs. Female GPs tend to support extending the age range and are more familiar with new technologies, whilst male GPs are more concerned about the legal implications of over and under-screening patients. Conclusions While the NCSP is generally well supported by GPs, there are differences in the knowledge and views of male and female GPs. This information provides a contemporary baseline from which to optimise the effectiveness of GPs as providers of cervical screening, improve the rate of appropriate utilisation and successfully implement any future changes to the national screening guidelines.
    Keywords: GPs, Cervical cancer screening, Australia
    JEL: I19
    Date: 2010–01
  4. By: Meliyanni Johar (CHERE, University of Technology, Sydney); Glenn Jones; Michael Keane; Elizabeth Savage; Olena Stavrunova
    Abstract: In the Australian public health system, access to elective surgery is rationed through provision of health care services, it is generally assumed that a patientÂ’s waiting time and locations. In this paper we undertake Oaxaca-Blinder and DiNardo-Fortin-Lemieux decompostition analyses to attribute variation in waiting time to a component explaine by clinical need and to differential treatment effects. The latter have an interpretation as discrimination, since treatments vary by non-clinical factors such as socioeconomic status. Using data from public patients in NSW public hospitals in 2004-2005, we find socioeconomically advantaged patients, patients in remote areas, and patients in several Area Health Services have shorter waiting times than their clinical comparable counterparts. Furthermore, the discrimination effect dominates clinical admission if their treatments are delayed. This finding has policy implications for the current operation of waiting lists and order of admission and for the design of equitable quality targets for public hospitals.
    Keywords: Public hospitals, waiting times, discrimination, decomposition analysis
    JEL: I11 J7 H51
    Date: 2010–06
  5. By: Meliyanni Johar (CHERE, University of Technology, Sydney); Glenn Jones; Michael Keane; Elizabeth Savage; Olena Stavrunova
    Abstract: Besley, Hall, and Preston (1999) estimated a model of the demand for private health insurance in Britain as a function of regional waiting lists and found that increases in the number of people waiting for more than 12 months (the long-term waiting list) increased the probability of insurance purchase. In the absence of waiting time data, the length of regional long-term waiting lists was used to capture the price-quality trade-off of public treatment. We revisit Besley et al.Â’s analysis using Australian data and test the use of waiting lists as a proxy for waiting time in models of insurance demand. Unlike Besley et al., we find that the long-term waiting list is not a significant determinant of the demand for insurance. However we find that long waiting times do significantly increase insurance. This suggests that the relationship between waiting times and waiting lists is not as straightforward as is commonly assumed.
    Keywords: waiting time, waiting lists, health insurance, regional aggregation
    JEL: I11 J7 H51
    Date: 2010–06
  6. By: Gisselle Gallego; Marion Haas (CHERE, University of Technology,Sydney); Jane Hall (CHERE, University of Technology,Sydney); Rosalie Viney (CHERE, University of Technology,Sydney)
    Abstract: This report covers international and Australian models for reducing the use of ineffective interventions, also described as disinvestment. Disinvestment is a development of Health Technology Assessment (HTA). Conventionally HTA has focussed on the introduction of new technologies. Although medical technology is advancing rapidly, there remain very many technologies in use which have not been subject to formal HTA. This has stimulated a growing interest in disinvestment. This review identified a number of case studies and pilot projects. There is limited information available on the mechanisms used, and no rigorous evaluations of their impact. The most developed model is that of NICE which has recently embarked on providing guidance for disinvestment. A number of technologies have been reviewed;but there is limited information available on how these were identified, how disinvestment is implemented, or what the effect has been. There is substantial resistance to any active disinvestment. Across the various case studies, appraisal of candidate technologies seems most likely to be triggered by expert opinion. In Australia, disinvestment is also generally passive. Technologies may be removed from funding or reimbursement if new research demonstrating harms or inefficacy becomes public. More generally, technologies fall into disuse, and are gradually replaced by new or improved technologies. Even when guidelines or funding rules are changed, there is generally continued use of an existing technology. This review has found that active disinvestment has generally been removal of funding for ineffective and/or unsafe technologies, usually initiated by new evidence of inefficacy or harm. Disinvestment is more likely to be passive, ie driven by changes in medical practice, as a procedure or treatment gradually falls out of use over time. There are very few instances of disinvestment, or appraisal for disinvestment, driven by considerations of cost-effectiveness. There are considerable difficulties implementing disinvestment in ineffective health care practices. One area of difficulty is an appropriate mechanism for identifying candidate technologies for appraisal. No explicit processes were identified, although there are a number of published criteria for prioritising candidates. The US is embarking on a major new program of HTA, termed Comparative Effectiveness Research. The list of priority topics for appraisal was developed by the Institute of Medicine, using nominations from health professionals, consumer advocates, policy analysts and others. The development of the candidate topics was a major exercise in itself. Studies of medical practice variations can also be used to identify candidate topics for appraisal. To date, there has been relatively little systematic investigation into practice variations in Australia. The availability of rich data sets which allow analysis on the basis of small areas is essential to research in this field, as is the research capacity to allow rigorous analysis. Program Budgeting and Marginal Analysis is a technique which uses HTA methods to drive disinvestment and reinvestment. It is a relatively resource-intensive activity, and requires clinicians to identify activities for disinvestment. Another area of difficulty arises because there are few or no incentives for clinicians in disinvestment. Thus reinforces the problems of identifying technologies for appraisal. As disinvestment will create losses, to clinicians, to consumers and to providers of the technology, there will be strong resistance to any active withdrawal of funding. At the same time, the additional benefits and/or savings from any disinvestments may not be realised for a considerable period of time and there is a risk that, for some products,interventions or services, cost savings, in particular, may not be realised. This increases the cost of pursuing disinvestment. Both HTA and disinvestment can be seen in a much broader context, that is the challenge is to ensure that the additional health spending brings commensurate benefits – ensuring health system efficiency. Although there is considerable interest in disinvestment, there are problems in identifying which technologies should be considered for disinvestment, and strong incentives to retain existing technologies. Disinvestment does occur, but generally as a result of existing treatments or other interventions falling into disfavour. An alternative approach to proactive disinvestment of specific technologies is to encourage more rapid change in medical practice. There are various strategies for health care reform which can be categorised as changing provider information, such as through the use of clinical guidelines, or the results of practice variations studies; changing incentives, though different payments for clinicians and other providers, or specifically targeted incentives; changing consumer behaviour, by providing more information with or without financial incentives; or changing the structures of health service delivery to provide organisational support and incentives for more efficient purchasing of care.
    Keywords: Disinvestment, Health Technology Assessment, Ineffective health care interventions
    JEL: I10
    Date: 2010–01
  7. By: Seema Narayan; Paresh Kumar Narayan; Sagarika Mishra
    Abstract: In this paper, we investigate the relationship between health and economic growth through including investment, exports, imports, and research and development (R&D), for 5 Asian countries using panel unit root, panel cointegration with structural breaks and panel long-run estimator for the period 1974-2007. We model this relationship within the production function framework, and unravel two important results. First, we find that in three variants of the growth model, variables share a long-run relationship; that is, they are cointegrated. Second, we find that in the long-run, while health, investment, exports, and R&D have contributed positively to economic growth, imports have had a statistically significant negative effect while education has had an insignificant effect. We draw important policy implications from these findings.
    Keywords: Health; Economic Growth; Panel Unit Root; Panel Cointegration.
    JEL: C23 C33 I10 I20
    Date: 2010–07–16
  8. By: Gollin, Douglas (Williams College); Zimmermann, Christian (University of Connecticut)
    Abstract: We study the impact of global climate change on the prevalence of tropical diseases using a heterogeneous agent dynamic general equilibrium model. In our framework, households can take actions (e.g., purchasing bednets or other goods) that provide partial protection from disease. However, these actions are costly and households face borrowing constraints. Parameterizing the model, we explore the impact of a worldwide temperature increase of 3° C. We find that the impact on disease prevalence and especially output should be modest and can be mitigated by improvements in protection efficacy.
    Keywords: DSGE models, climate change, tropical diseases, incomplete markets
    JEL: I1 O11 E13 E21 Q54
    Date: 2010–07
  9. By: Yoshito Takasaki
    Abstract: Using original household panel survey data collected in rural Fiji, this paper demonstrates how informal risk-sharing institutions upon which poor people heavily rely in times of illness are vulnerable to natural disasters. First, household private cash-inkind transfers do not serve as insurance against illness in the relief phase (several months after the disaster); they do so only after pooled resources are recovered in the reconstruction phase (a few years later) (i.e., the resource effect). Second, risk-sharing arrangements are dependent on the history of labor-time transfers corresponding to housing damage: Only disaster non-victims are insured against illness, because victims have already received labor help for their rehabilitation from non-victims (i.e., the reciprocity effect). The paper also reveals that resource/reciprocity effects exist in endogenously formed networks and pre-formed groups, as risk-sharing pools to a similar degree. Not only do private transfers exchanged among households serve as insurance, but also, household contributions directly made to groups – such as ritual gifts and religious donations – contain risk- sharing components against illness among group members. Although the former finding is commonly evident in the literature, the latter is new. Network formation is directly related to pre-formed groups, especially kin and religious ones.
    Date: 2010–07
  10. By: Renaud Bourlès (École Centrale de Marseille and Greqam)
    Abstract: This paper examines the effect of moral hazard on public health insurance contract. It models primary prevention in a two period model with classification risk. Agent’s preferences appear to play an important role in the optimal determination of preventive effort and insurance between generations. If absolute prudence is larger than twice absolute risk aversion, moral hazard increases intergenerational insurance and classification risk. This highlights a tradeoff between prevention and insurance arising from classification risk. An increase in the difference between prudence and twice risk aversion (that we define as the degree of “protectiveness”) moreover makes public insurance contracts more stable (when competing with spot insurance) if the cost of prevention is low enough when agents preferences exhibit CRRA. Under a formulated utility function with linear reciprocal derivative, we finally show that an increase in agent’s degree of “protectiveness” enhances the stability of public insurance and the extent of intergenerational insurance.
    Keywords: Public health insurance; Classification risk; Moral Hazard; Prudence.
    JEL: D81 D91 G22
    Date: 2010–02–17
  11. By: HILDEBRAND Vincent; VAN KERM Philippe
    Abstract: Evidence of the association between wages and body size –typically measured by the body mass index– appears to be sensitive to estimation methods and samples, and varies across gender and ethnic groups. One factor that may contribute to this sensitivity is the non-linearity of the relationship. This paper analyzes data from the European Community Household Panel survey and uses semi-parametric techniques to avoid functional form assumptions and assess the relevance of standard models. If a linear model for women and a quadratic model for men fit the data relatively well, they are not entirely satisfactory and are statistically rejected in favour of semiparametric models which identify patterns that none of the parametric specifications capture. Furthermore, when we use height and weight in the models directly, rather than equating body size with the body mass index, the semi-parametric models reveal a more complex picture with height having additional effects on wages. We interpret our results as consistent with the existence of a wage premium for physical attractiveness rather than a penalty for unhealthy weight.
    Keywords: Body Mass Index; Obesity; Wages; Partial linear models; ECHP
    JEL: C14 J31 J71
    Date: 2010–06
  12. By: Thomas J. Bollyky
    Abstract: There has been tremendous progress over the last decade in the development of health products for neglected diseases. These include drugs, vaccines, and diagnostics for malaria and tuberculosis, which kill millions of people annually, plus other diseases like changes and dengue fever, which may less familiar, but nonetheless exact a large and often lethal toll in the world’s poorest communities. Led by product development public- private partnerships (PDPs) and fueled by the support of the Bill & Melinda Gates Foundation, the National Institutes of Health, and other donors, there are now dozens of candidate products in the pipeline. [Working Paper No. 217]
    Keywords: health products, drugs, vaccines, malaria, tuberculosis, dengue fever, development public- private partnerships, Bill & Melinda Gates Foundation, National Institutes of Health
    Date: 2010
  13. By: Bharati Sharma; Dileep Mavalankar; Pallavi Ranjan; Poonam Trivedi; Sweta Roy
    Abstract: The role of the DPHNs has reduced over the years because they have not been assigned new roles with change in programmes and policies. Most of the DPHNs have training for clinical work in hospitals. Their 10 month training to qualify for PHN is inadequate to develop knowledge and skills in public health. There is a gap between their training and posting due to delays in government procedures of promotion. The DPHN/DPHNOs spend majority of their time in the office (49%) where they have a limited role. Their supervisory role for nurses and midwives has lost its importance. They spend about 1/3rd of their time in field supervision mostly visiting centres accessible by public transport as they do not have an allotted government vehicle. As they do not submit any field report, there is no follow-up action from their visit. Nevertheless they seem to have an important role in solving problems of field workers as they are mediators between the district and peripheral facilities. To conclude the DPHNs are under utilized which affects the quality of maternal and child health services in the district. [Working Paper No. 2010-02-04]
    Keywords: District Programme Management Unit, clinical work, supervisory role, child health services
    Date: 2010
  14. By: Murat Arik
    Abstract: This study analyzes the trends and scope of the core health care industry in Nashville, assesses the economic impact of the health care industry cluster on the regional economy, compares Nashville with 12 peer MSAs using selected health care related indicators, profiles the member companies of the Nashville Health Care Council, and presents the results of a CEO Confidence Survey.
    Keywords: health care, economic impact, Nashville, Nashville health care, nashville health care study, Nashville health care council, health care industry, health care indicators, health care CEO survey
    Date: 2010–07
  15. By: Anna Alberini (University of Maryland and FEEM); Milan Šcasný, Charles University Prague (Charles University Prague)
    Abstract: We report on the results of a survey based on conjoint choice experiments that was specifically designed to investigate the effect of context on the Value of a Statistical Life (VSL), an important input into the calculation of the mortality benefits of environmental policies that reduce premature mortality. We define “context” broadly to include i) the cause of death (respiratory illness, cancer, road traffic accident), ii) the beneficiary of the risk reduction (adult v. child), and iii) the mode of provision of the risk reduction (public program v. private good). The survey was conducted following similar protocols in Italy and the Czech Republic. When do not distinguish for the cause of death, child and adult VSL are not significantly different from one another in Italy, and the difference is weak in the Czech sample. When we distinguish for the cause of death, we find that child and adult VSLs are different at the 1% level for respiratory illnesses and road-traffic accidents, but do not differ for cancer risks. We find evidence of a “cancer premium” and a “public program premium.” In both countries, the marginal utility of income is about 20% lower among wealthier people, which makes the VSL about 20% higher among respondents with incomes above the sample average. The discount rate implicit in people‘s choices is effectively zero. We conclude that there is heterogeneity in the VSL, and that such heterogeneity is primarily driven by risk characteristics and mode of delivery of the risk reduction, rather than by individual characteristics of the respondent (e.g., income and education). For the most part, our results do not disagree with environmental policy analyses that use the same VSL for children and adults, and that apply a cancer premium.
    Keywords: VSL, Conjoint Choice Experiments, Mortality Risk Reductions, Cost-benefit Analysis, Forced Choice Questions
    JEL: I18 J17 K32 Q51
    Date: 2010–06
  16. By: Eva Deuchert
    Abstract: It is widely believed that HIV is predominantly sexually transmitted in Sub Saharan Africa. This claim which is inconsistent with national representative data from Lesotho, Zimbabwe, and Swaziland, which reveals that a significant proportion of HIV infections occurred in adolescents who claim to be virgins. Two explanations for this observation have been proposed: adolescents misreport sexual status or non-sexual risks are more prevalent than previously asserted. This paper empirically uncovers the implicit assumptions underlying this discussion, by estimating the proportion of sexually transmitted HIV infections assuming that misreporting is irrelevant, and the proportion of misreporting necessary to conclude that HIV is predominantly sexually transmitted. It shows that under the no-misreporting assumption, 70% of HIV cases in the respective sample of unmarried adolescent women is not due to sexual transmission. The assumption that HIV is predominantly sexually transmitted is only valid, if more than 55% of unmarried adolescent women who are sexually active have misreported sexual activity status. This research is designed to gain better understanding on the importance of different transmission modes. This is important to design combination prevention to achieve maximum impact on HIV prevention.
    Keywords: Population attributable fraction; non-classical measurement error; HIV transmission mode
    JEL: C13 C14 I12
    Date: 2010–07
  17. By: Hamish Low (Institute for Fiscal Studies and Trinity College, Cambridge); Luigi Pistaferri (Institute for Fiscal Studies and Stanford University)
    Abstract: The Disability Insurance (DI) program in the US is a large social insurance program that offers income replacement benefits to people with work limiting disabilities. The proportion of DI claimants in the US is now almost 5% of the working-age population and the cost is three times that of unemployment insurance. The key questions in thinking about the size and growth of the DI program are whether program claimants are genuinely unable to work, and how valuable is the insurance provided. This paper has three aims: 1. We provide a framework for weighing up the insurance value of disability benefi…ts against the incentive cost of inducing healthy individuals to stop work at different points of their life-cycle. 2. We estimate the risks to health that may lead to work-limiting disabilities and the risk to wages that may lead to individuals choosing not to work. We also estimate the extent of false awards made through the DI program alongside the proportion of awards to those in genuine need. 3. We use our model and estimates to characterize the economic effects of the disability insurance and to consider how policy reforms would affect behaviour and standard measures of household welfare. We differentiate disability status by its severity, and show that a severe disability shock leads to a decline in wages of 40%, as well as a substantial rise in the fixed cost of going to work. In terms of the effectiveness of the DI program, we estimate high levels of rejections of genuine applicants. In our counterfactual simulations, this means that household welfare increases as the program becomes less strict, despite the worsening incentives for false applications that this implies. On the other hand, incentives for false applications are reduced by reducing generosity and increasing reassessments, and these policies increase household welfare, despite the worse insurance implied.
    Keywords: Disability, social security, savings behavior, wage risk
    JEL: D91 H53 H55 J26
    Date: 2010–05
  18. By: Pieter Serneels; Jose G. Montalvo; Gunilla Pettersson; Tomas Lievens; Jean Damascene Butera; Aklilu Kidanu
    Abstract: Background: Most developing countries face shortages of health workers in rural areas. This has profound consequences for health service delivery, and ultimately for health outcomes. To design policies that rectify these geographic imbalances it is vital to understand what factors determine health workers’ choice to work in rural areas. But empirical analysis of health worker preferences has remained limited due to the lack of data. Methods: Using unique contingent valuation data from a cohort survey of 412 nursing and medical students in Rwanda, this paper examines the determinants of future health workers’ willingness to work in rural areas, as measured by rural reservation wages, using regression analysis. These data are also combined with those from an identical survey in Ethiopia to enable a two-country analysis. Results: Health workers with higher intrinsic motivation - measured as the importance attached to helping the poor - as well as those who have grown up in a rural area, and Adventists who participate in a local bonding scheme are all significantly more willing to work in a rural area. The main Rwanda result for intrinsic motivation is strikingly similar to that obtained for Ethiopia and Rwanda together. Discussion: The results suggest that in addition to economic incentives, intrinsic motivation and rural origin play an important role in health workers’ decisions to work in a rural area, and that faith-based institutions matter.
    Date: 2010
  19. By: Monazza Aslam; Geeta Kingdon
    Abstract: This study investigates the relationship between parental schooling on the one hand, and child health outcomes (height and weight) and parental health-seeking behaviour (immunisation status of children), on the other. While establishing a correlational link between parental schooling and child health is relatively straightforward, confirming a causal relationship is more complex. Using unique data from Pakistan, we aim to understand the mechanisms through which parental schooling promotes better child health and health-seeking behaviour. The following ‘pathways’ are investigated: educated parents’ greater household income, exposure to media, literacy, labour market participation, health knowledge and the extent of maternal empowerment within the home. We find that while father's education is positively associated with the 'one-off' immunisation decision, mother's education is more critically associated with longer term health outcomes in OLS equations. Instrumental variable (IV) estimates suggest that father's health knowledge is most positively associated with immunisation decisions while mother's health knowledge and her empowerment within the home are the channels through which her education impacts her child's height and weight respectively.
    Keywords: parental schooling, mother's health knowledge, father's health knowledge, media exposure, maternal empowerment, child health, immunisation, Pakistan.
    JEL: I1 I2
    Date: 2010
  20. By: Alexander Moradi
    Abstract: Sub-Sahara African populations are tall relative to the extremely adverse disease environment and their low incomes. Selective mortality, which removes shorter individuals leaving taller individuals in the population, was proposed as an explanation. From heights of surviving and non-surviving children in Gambia, we estimate the size of the survivorship bias and find it to be too small to account for the tall adult heights observed in sub-Saharan Africa. We propose instead a different yet widely ignored explanation: African populations attain a tall adult stature, because they can make up a significant amount of the growth shortfall after age 5. This pattern is in striking contrast to other developing countries. Moreover, mortality rates are relatively low after age 5 adding further doubts about selective mortality.
    Keywords: adult height, mortality, sub-Saharan Africa, catch-up growth
    Date: 2010
  21. By: Geeta Kingdon
    Abstract: Using new and unique panel data, we investigate the role of long-term health and childhood malnutrition in schooling outcomes for children in rural India, many of whom lack basic numeracy and literacy skills. Using data on students’ performance on mathematics and Hindi tests, we examine the role of the endogeneity of health caused by omitted variables bias and measurement error and correct for these problems using a household fixed effects estimator on a sub-sample of siblings observed in the data. We also present several extensions and robustness checks using instrumental variables and alternative estimators. We find evidence of a positive causal effect of long-term health measured as height-for-age z-score (HAZ) on test scores, and the results are consistent across several different specifications. The results imply that improving childhood nutrition will have benefits that extend beyond health into education.
    Keywords: Health, Nutrition, Schooling, India
    JEL: I12 I21
    Date: 2010
  22. By: Danila Serra; Pieter Serneels; Abigail Barr
    Abstract: Economists have traditionally assumed that individual behavior is motivated exclusively by extrinsic incentives. Social psychologists, in contrast, stress that intrinsic motivations are also important. In recent work, economic theorists have started to build psychological factors, like intrinsic motivations, into their models. Besley and Ghatak (2005) propose that individuals are differently motivated in that they have different “missions,” and their self-selection into sectors or organizations with matching missions enhances organizational efficiency. We test Besley and Ghatak’s model using data from a unique cohort study. We generate two proxies for intrinsic motivations: a survey-based measure of the health professionals philanthropic motivations and an experimental measure of their pro-social motivations. We find that both proxies predict health professionals’ decision to work in the non-profit sector. We also find that philanthropic health workers employed in the non-profit sector earn lower wages than their colleagues.
    JEL: C93 I11 J24
    Date: 2010
  23. By: Pablo Brañas Garza (Universidad de Granada); María Paz Espinosa (; María Repolles Pro (Servicio de Anestesiología, Hospital Virgen de las Nieves, Granada, Spain.)
    Abstract: Empirical results are presented showing that people who acknowledge pain anticipation when expecting an injury experience higher sensitivity to pain (GREP, Robinson et al., 2001). The positive correlation between sensitivity and anticipation is highly significant. However, no relationship is found between anticipation and pain endurance.
    Keywords: Discounting, Pain anticipation, Sensitivity and endurance
    JEL: C91
    Date: 2010–07–12
  24. By: Martin Gaynor; Rodrigo Moreno-Serra; Carol Propper
    Abstract: The effect of competition on the quality of health care remains a contested issue. Most empirical estimates rely on inference from non experimental data. In contrast, this paper exploits a pro-competitive policy reform to provide estimates of the impact of competition on hospital outcomes. The English government introduced a policy in 2006 to promote competition between hospitals. Patients were given choice of location for hospital care and provided information on the quality and timeliness of care. Prices, previously negotiated between buyer and seller, were set centrally under a DRG type system. Using this policy to implement a difference-in-differences research design we estimate the impact of the introduction of competition on not only clinical outcomes but also productivity and expenditure. Our data set is large, containing information on approximately 68,000 discharges per year per hospital from 162 hospitals. We find that the effect of competition is to save lives without raising costs. Patients discharged from hospitals located in markets where competition was more feasible were less likely to die, had shorter length of stay and were treated at the same cost.
    JEL: I11 I18 L13 L32
    Date: 2010–07
  25. By: Mohamad Al-Ississ; Nolan H. Miller
    Abstract: President Obama's health insurance reform efforts, as embodied in the bills passed by the House and Senate in late 2009 and signed into law in March of 2010, have been described both as a boon and a death blow for private insurance industries. Using stock-price data on health care firms in the S&P health index, we exploit Republican Scott Brown's surprise victory in the Massachusetts Special Senate election to fill the seat of the late Ted Kennedy, which stripped Democrats of the 60-vote majority needed to pass the bill in the Senate, to evaluate the market's assessment of health reform on the health care industry. We find that the reduced likelihood of Health Reform’s passage after the Brown election led to a significant increase in health industry stocks and average cumulative abnormal returns of 1.2 percent, corresponding to an increase in total market value of approximately $14.5 billion. Focusing on managed care (insurance) firms, we find an average cumulative abnormal return of 6.5 percent (a $6.7 billion increase in market value), with individual firms’ cumulative abnormal returns ranging from around 5 to 9 percent.
    JEL: D72 G14 I11
    Date: 2010–07

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