nep-hea New Economics Papers
on Health Economics
Issue of 2010‒08‒06
fifteen papers chosen by
Yong Yin
SUNY at Buffalo, USA

  2. Income and Longevity Revisited: Do High-Earning Women Live Longer? By Friedrich Breyer; Jan Marcus
  3. The Rise in Absenteeism: Disentangling the Impacts of Cohort, Age and Time By Biorn, Erik; Gaure, Simen; Markussen, Simen; Roed, Knut
  4. Death by Market Power. Reform, Competition and Patient Outcomes in the National Health Service By Martin Gaynor; Rodrigo Moreno-Serra; Carol Propper
  5. The Impact of Competition on Management Quality: Evidence from Public Hospitals By Nicholas Bloom; Carol Propper; Stephan Seiler; John van Reenan
  6. What Factors Influence the Earnings of GPs and Medical Specialists in Australia? Evidence from the MABEL Survey By Terence Chai Cheng; Anthony Scott; Sung-Hee Jeon; Guyonne Kalb; John Humphreys; Catherine Joyce Department of Epidemiology and Preventive Medicine, Monash University
  7. Health-care reform in Korea By Randall S. Jones
  8. Education, Alcohol Use and Abuse Among Young Adults in Britain By Maria Carmen Huerta; Francesca Borgonovi
  9. Self-perceived Health of Ultra Poor Women: The Effect of an Inclusive Development Intervention By Vivek A Prakash; AKM Masud Rana
  10. Differences in Sick Leave Between Employed and Unemployed Workers. What Do They Tell Us About the Health Dimension of Unemployment? By Thomas Leoni
  11. Intrinsic motivations and the non-profit health sector: Evidence from Ethiopia By Danila Serra; Pieter Serneels; Abigail Barr
  12. Selective Mortality or Growth after Childhood? What Really is Key to Understand the Puzzlingly Tall Adult Heights in Sub-Saharan Africa By Alexander Moradi
  13. Parental Education and Child Health - Understanding the Pathways of Impact in Pakistan By Monazza Aslam; Geeta Kingdon
  14. 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
  15. Health, Nutrition and Academic Achievement: New Evidence from India By Geeta Kingdon

  1. By: Vincenzo Carrieri (Dipartimento di Economia e Statistica, Università della Calabria)
    Abstract: The importance of social comparison in shaping individual utility has been widely documented by subjective well-being literature. So far, income has been the main dimension considered in social comparison. This paper aims to investigate whether subjective well-being is influenced by inter-personal comparison with respect to health. Thus, we study the effects of the health of others and relative health hypothesis on two measures of subjective well-being: happiness and subjective health. Using data from the Italian Health Conditions survey, we show that a high incidence of chronic conditions and disability among reference groups negatively affects both happiness and subjective health. Such effects are stronger among people in the same conditions. These results, robust to different econometric specifications and estimation techniques, suggest the presence of some sympathy in individual preferences with respect to health and reveal that other people?s health status serves as a benchmark to assess one?s own health conditions.
    Keywords: health conditions, social comparison, subjective well-being
    JEL: C21 D64 I31
    Date: 2010–07
  2. By: Friedrich Breyer; Jan Marcus
    Abstract: The empirical relationship between income and longevity has been addressed by a large number of studies, but most were confined to men. In particular, administrative data from public pension systems are less reliable for women because of the loose relationship between own earnings and household income. Following the procedure first used by Hupfeld (2010), we analyze a large data set from the German public pension scheme on women who died between 1994 and 2005, employing both non-parametric and parametric methods. To overcome the problem mentioned above we concentrate on women with relatively long earnings history. We find that the relationship between earnings and life expectancy is very similar for women as for men: Among women who contributed at least for 25 years, a woman at the 90th percentile of the income distribution can expect to live 3 years longer than a woman at the 10th percentile.
    Keywords: Life expectancy and income, women, public pensions, Germany
    JEL: I12 H55
    Date: 2010
  3. By: Biorn, Erik (University of Oslo); Gaure, Simen (Ragnar Frisch Centre for Economic Research); Markussen, Simen (Ragnar Frisch Centre for Economic Research); Roed, Knut (Ragnar Frisch Centre for Economic Research)
    Abstract: We examine the remarkable rise in absenteeism among Norwegian employees since the early 1990's, with particular emphasis on disentangling the roles of cohort, age, and time. Based on a fixed effects model, we show that individual age-adjusted absence propensities have risen even more than aggregate absence rates from 1993 to 2005, debunking the popular hypothesis that the rise in absenteeism resulted from the inclusion of new cohorts – with weaker work-norms – into the workforce. We also reject the idea that the rise in absenteeism resulted from more successful integration of workers with poor health; on the contrary, a massive rise in disability rolls during the 1990’s suggest that poor-health workers have left the labor market in unprecedented numbers.
    Keywords: sickness absence, endogenous selection, multicollinearity, fixed effects logit
    JEL: C23 C25 I38 J22
    Date: 2010–07
  4. 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 160 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.
    Keywords: competition, hospitals, quality
    JEL: I18 I11 L13 L32
    Date: 2010–07
  5. By: Nicholas Bloom; Carol Propper; Stephan Seiler; John van Reenan
    Abstract: In this paper we examine the causal impact of competition on management quality. We analyze the hospital sector where geographic proximity is a key determinant of competition, and English public hospitals where political competition can be used to construct instrumental variables for market structure. Since almost all major English hospitals are government run, closing hospitals in areas where the governing party has a small majority is rare due to fear of electoral punishment. We find that management quality - measured using a new survey tool - is strongly correlated with financial and clinical outcomes such as survival rates from emergency heart attack admissions (AMI). More importantly, we find that higher competition (as indicated by a greater number of neighboring hospitals) is positively correlated with increased management quality, and this relationship strengthens when we instrument the number of local hospitals with local political competition. Adding another rival hospital increases the index of management quality by one third of a standard deviation and leads to a 10.7% reduction in heart-attack mortality rates.
    Keywords: management, hospitals, competition, productivity
    JEL: J45 F12 I18 J31
    Date: 2010–05
  6. By: Terence Chai Cheng (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Anthony Scott (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Sung-Hee Jeon (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Guyonne Kalb (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); John Humphreys (School of Rural Health, Monash University); Catherine Joyce Department of Epidemiology and Preventive Medicine, Monash University
    Abstract: To date, there has been little data or empirical research on the determinants of doctors' earnings despite earnings having an important role in influencing the cost of health care, decisions on workforce participation and labour supply. This paper examines the determinants of annual earnings of general practitioners and specialists using the first wave of the Medicine in Australia: Balancing Employment and Life (MABEL), a new longitudinal survey of doctors in Australia. For both GPs and specialists, earnings are higher for men, for those who are self-employed, who do after hours or on-call work, and who work in areas with a high cost of living. GPs have higher earnings if they work in larger practices, in outer regional or rural areas, and in areas with lower GP density, whilst specialists earn more if they are a fellow of their college, have more working experience, spend more time in clinical work, have less complex patients, or work in inner regional areas. Overall, GPs earn about 32% less than specialists. The returns from on-call work, experience, and self-employment are higher for specialists compared to GPs.
    Keywords: earnings, general practitioners, hedonic regression, specialists
    JEL: I11 J30 I18
    Date: 2010–07
  7. By: Randall S. Jones
    Abstract: Korea’s health-care system has contributed to the marked improvement in health conditions, while limiting spending to one of the lowest levels in the OECD through high patient co-payments and limited coverage of public health insurance. However, spending is now increasing at the fastest rate in the OECD. With continued upward pressure, not least from rapid population ageing, it is essential to boost efficiency by reforming the payment system, reducing drug expenditures, shifting long-term care out of hospitals, promoting healthy ageing and introducing gatekeepers. As the heavy reliance on social insurance payments for health will be an increasing drag on employment as the population ages, it is necessary to raise the share of tax-based financing in conjunction with effective measures to keep spending in check. Measures to ensure adequate access for low-income households are a priority given the high out-of-pocket payments. Quality should be improved by enhancing transparency, promoting restructuring in the hospital sector and expanding the number of doctors.<P>La réforme des soins de santé en Corée<BR>Le système de santé coréen a contribué à la nette amélioration de l’état de santé de la population, tout en limitant les dépenses à un niveau qui compte parmi les plus faibles de la zone de l’OCDE, les deux facteurs qui ont joué à cet égard étant la forte participation financière du patient et la couverture limitée de l’assurance-maladie publique. Néanmoins, les dépenses augmentent actuellement au rythme le plus rapide de la zone de l’OCDE. La tendance à la hausse étant appelée à se poursuivre, en particulier à cause du vieillissement rapide de la population, il est indispensable d’accroître l’efficience en réformant le système de paiement, en réduisant les dépenses pharmaceutiques, en ne confiant plus aux hôpitaux les soins de longue durée, en favorisant le vieillissement en bonne santé et en mettant en place un filtrage pour l’accès aux soins. Puisque, du fait du vieillissement de la population, le poids accordé aux paiements d’assurances sociales pour le financement du système de santé constituera de plus en plus un frein pour l’emploi, il est important d’accroître la part du financement de source fiscale. Il faut prioritairement assurer un accès correct des ménages à bas revenu, étant donné le niveau élevé des versements directs. Il faudrait améliorer la qualité des soins en instaurant plus de transparence, en favorisant la restructuration du secteur hospitalier et en augmentant les effectifs de médecins.
    Keywords: long-term care, diagnosis related groups, generic drugs, healthy ageing, medical expenditures, National Health Insurance, Korean health care, private health insurance, hospitals, financing health care, Separation Reform, Integration Reform, pharmaceutical drugs, co-payments, physicians, soins de longue durée, produits pharmaceutiques, vieillissement en bonne santé, dépenses médicales, assurance santé nationale, médicaments génériques, médecins, système de santé en Corée, assurance maladie privée, hôpitaux, groupe homogène de malades, financement des soins de santé, réforme de séparation, réforme d’intégration, part des dépenses de santé à la charge des assurés
    JEL: I1
    Date: 2010–07–02
  8. By: Maria Carmen Huerta; Francesca Borgonovi
    Abstract: In this article we explore the relationship between education and alcohol consumption. We examine whether the probability of abusing alcohol differs across educational groups. We use data from the British Cohort Study, a longitudinal study of one week’s birth in Britain in 1970. Measures of alcohol abuse include alcohol consumption above NHS guidelines, daily alcohol consumption and problem drinking. Higher educational attainment is associated with increased odds of daily alcohol consumption and problem drinking. The relationship is stronger for females than males. Individuals who achieved high test scores in childhood are at a significantly higher risk of abusing alcohol across all dimensions. Our results also suggest that educational qualifications and academic performance are associated with the probability of belonging to different typologies of alcohol consumers among women while this association is not present in the case of educational qualifications and is very weak in the case of academic performance among males.<BR>Dans cet article, nous explorons le rapport entre l’éducation et la consommation d’alcool. Nous analysons si la probabilité de consommer de l’alcool de façon abusive diffère en fonction du niveau d’éducation. Nous utilisons des données de la British Cohort Study, une étude longitudinale menée pendant une semaine en Grande-Bretagne dans les années 70. L’évaluation de l’abus d’alcool inclut la consommation d’alcool située au dessus des normes NHS, la consommation quotidienne d’alcool et les problèmes d’alcoolisme. Le niveau d’éducation supérieur est associé à des risques accrus de consommation quotidienne d’alcool et à des problèmes avec l’alcool. La relation est plus forte chez les femmes que chez les hommes. Les individus qui obtiennent des notes élevées dans leur enfance ont significativement plus de risques d’avoir des problèmes avec l’alcool. Nos résultats suggèrent également que le niveau d’études ainsi que les performances scolaires augmentent les risques pour les femmes d’appartenir à ces différentes catégories de consommateurs d’alcool, alors que chez les hommes, le risque de consommation n’est pas lié au niveau d’éducation et est très faible en cas de performances scolaires élevées.
    Date: 2010–07–01
  9. By: Vivek A Prakash; AKM Masud Rana
    Abstract: In 2002, BRAC launched a targeted and comprehensive development programme called Challenging the Frontiers of Poverty Reduction: Targeting the Ultra Poor (CFPR/TUP) aimed at the poorest of the poor, who have often been excluded from other development initiatives. This study examines changes in the self-reported health status of these ultra poor women in northern Bangladesh over a period of one and half years since the launch of this programme. The data for this study come from a baseline survey performed in 2002 and a follow-up survey from 2004. The ultra poor women selected for the CFPR/TUP programme fared far better than those not included in the programme with better self-reported health status. Programme effects remain positive and significant after controlling for marital status, education, age, previous health, disability, occupation, sanitary knowledge and behaviour, family planning, and location. We conclude that the CFPR/TUP programme has a significant effect on women’s health, highlighting the importance of development as a holistic process with various components. [CFPR/TUP Working Paper Series No. 10]
    Keywords: comprehensive development programme, Challenging the Frontiers of Poverty Reduction, development initiatives, self-reported health status, Bangladesh, health status, positive
    Date: 2010
  10. By: Thomas Leoni (WIFO)
    Abstract: Unemployed workers suffer from poor health conditions, a fact which is documented by a large number of studies covering objective health measures, satisfaction with health status and mortality. This paper contributes to the literature with an empirical analysis of sick leave micro-data from Austrian social insurance agencies. The data represent an interesting source of information because in Austria both employed and unemployed workers are entitled to sickness benefits and both groups are subject to almost identical sick pay regulations. Aggregate statistics show that the unemployed spend close to 9 percent of their time on sick leave, against an average of 3.4 percent for the employed. Further evidence indicates that they report much longer illness spells and a higher number of hospitalisations. Both selection and causation effects can help to understand this large gap in health outcomes. Workers who become unemployed had markedly higher absence rates in employment than fellow workers who stay in employment. This difference, which can be interpreted as an approximation for the selection effect, accounts for roughly half of the observed gap in sick leave rates between the employed and the unemployed. On the other hand there exists a positive albeit non-linear relationship between sick leave and unemployment duration, corroborating the view that unemployment impacts health negatively. In accordance with previous studies I find that the unemployed suffer very often from mental disorders. Although women have a higher incidence of mental disorders than men in both employment and unemployment, it is unemployed men who experience the sharpest increase in mental problems in the wake of unemployment.
    Keywords: unemployment, sick leave, sickness, health, social insurance data
    Date: 2010–06–11
  11. 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
  12. 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
  13. 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
  14. 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
  15. 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

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