nep-hea New Economics Papers
on Health Economics
Issue of 2011‒02‒12
23 papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. Entry and Exit of Physicians in a two-tiered public/private Health Care System By Martin Gächter; Peter Schwazer; Engelbert Theurl
  2. Peer Effects, Fast Food Consumption and Adolescent Weight Gain By Bernard Fortin; Myra Yazbeck
  3. The Dynamics of Nutrition and Child Health Stocks By Natascha Wagner, Matthias Rieger
  4. The Indirect Effect of Fine Particulate Matter on Health through Individuals' Life-style By Cinzia Di Novi
  6. Accounting for the dead in the longitudinal analysis of income-related health inequalities By Petrie , Dennis; Allanson, Paul; Gerdtham, Ulf-G
  7. Mortality Amenable to Health Care in 31 OECD Countries: Estimates and Methodological Issues By Juan G. Gay; Valérie Paris; Marion Devaux; Michael de Looper
  8. Resource Allocation, Financing and Sustainability in the Health Sector By Brick, Aoife; Nolan, Anne; O'Reilly, Jacqueline; Smith, Samantha
  9. Providing Quality Pharmacy Services: Good Intentions Are Not Enough By Gorecki, Paul K.
  10. Red, Blue, and the Flu: Media Self-Selection and Partisan Gaps in Swine Flu Vaccinations By Baum, Matthew A.
  11. National Programme for the Health Care of the Elderly (NPHCE): An Approach towards Active and Healthy Ageing By Ministry of Health and Family Welfare
  12. The Impact of Education on Health Status: Evidence from Longitudinal Survey Data. By Bichaka Fayissa; Shah Danyal; J.S. Butler
  13. Does the Cause of Death Matter? The Effect of Dread, Controllability, Exposure and Latency on the Vsl By Anna Alberini; Milan Šcasný
  14. Intergenerational continuities in ethnic inequalities in health in the UK. By Smith, N.R.
  15. Occupational Status and Health Transitions By Morefield, G. Brant; Ribar, David; Ruhm, Christopher
  16. Evaluating Innovation and Moral Hazard in Pharmaceuticals By Paris Cleanthous
  17. Does Openness Lead to More or Less Development? The Case of Health Deterioration By Paris Cleanthous
  18. Welfare Effects of Pharmaceutical Informative Advertising By Paris Cleanthous
  19. The Effects of Childhood Health on Adult Health and SES in China By James P. Smith; Yan Shen; John Strauss; Zhe Yang; Yaohui Zhao
  20. Data Sets on Pensions and Health: Data Collection and Sharing for Policy Design By Jinkook Lee
  21. Disability of Older Koreans: Evidence on Prevalence and the Role of Education from Five Data Sets By Jibum Kim; Jinkook Lee
  22. Mortality Crisis in Russia Revisited: Evidence from Cross-regional Comparison By Vladimir Popov
  23. Comment on David Cutler and Adriana Lleras-Muney (2008): “Education and Health: Evaluating Theories and Evidence” By Hlavac, Marek

  1. By: Martin Gächter; Peter Schwazer; Engelbert Theurl
    Abstract: Firm turnover has recently attracted increased interest in economic research. The entry of new firms increases competition and promises efficiency gains. Moreover, changes in the market structure influence productivity growth, because firm entry usually leads to increased innovation. The health care market exhibits important differences as compared to other markets, including various forms of market failure and, as a consequence, extensive market regulation. Thus, the economic effects of entries and exits in health care markets are less obvious. The following paper studies the determinants of entry and exit decisions of physicians in the private sector of the outpatient part of the Austrian health care system. We apply a Poisson panel estimation to a data set of 2,379 local communities and 121 districts in Austria in the time period 2002 - 2008. We are particularly interested in the question how public physicians (GPs/specialists) and their private counterparts influence the entrance and exit of private physicians. We find a significantly negative effect of existing capacities, measured by both private and public physician density of the same specialty, on the entry of new private physicians. On the contrary, we find a significantly positive effect of private GPs on the entry of private specialists. Interestingly, this cooperation/network effect also works in the other direction, as a higher density of private specialists increases the probability of the market entry of private GPs. Based on the results of previous literature, we thus conclude that private physicians establish networks to cooperate in terms of mutual referrals etc. Our estimations for market exits basically confirm the entry results, as higher competitive forces positively influence the market exit of private physicians.
    Keywords: Entry, Exit, Health Care, Physician location
    JEL: I11 I18 L14
    Date: 2011–02
  2. By: Bernard Fortin; Myra Yazbeck
    Abstract: This paper aims at opening the black box of peer effects in adolescent weight gain. Using Add Health data on secondary schools in the U.S., we investigate whether these effects partly flow through the eating habits channel. Adolescents are assumed to interact through a friendship social network. We first propose a social interaction model of fast food consumption using a generalized spatial autoregressive approach. We exploit results by Bramoullé, Djebbari and Fortin (2009) which show that intransitive links within a network (i.e., a friend of one of my friends is not my friend) help identify peer effects. The model is estimated using maximum likelihood and generalized 2SLS strategies. We also estimate a panel dynamic weight gain production function relating an adolescent’s Body Mass Index (BMI) to his current fast food consumption and his lagged BMI level. Results show that there are positive significant peer effects in fast food consumption among adolescents belonging to a same friendship school network. The estimated social multiplier is 1.59. Our results also suggest that, at the network level, an extra day of weekly fast food restaurant visits increases BMI by 2.4%, when peer effects are taken into account.
    Keywords: Obesity, overweight, peer effects, social interactions, fast food, spatial models
    JEL: C31 I10 I12
    Date: 2011
  3. By: Natascha Wagner, Matthias Rieger (IHEID, The Graduate Institute of International and Development Studies, Geneva)
    Abstract: Height-for-age (HA) and weight-for-age (WA) of children are standard measures to study the determinants of stunting and short-term underweight. Rather than studying these indicators separately, this paper looks at their interaction and therefore at the dynamics of height and weight. Considering HA a child's health stock and WA nutritional investment, we develop an overlapping generations model. The main features of the model are self-productivity of health stocks and the dynamic complementarity between past health stocks and contemporaneous nutrition. We test the model's predictions on a Senegalese panel of 305 children between 0 and 5 years over three periods. To control for endogeneity and serial correlation we employ different GMM methods. We find evidence of self-productive health stocks and that child health produced at one stage raises the productivity of nutritional inputs at subsequent stages. Our results indicate that child health is quickly depleted and needs constant updating. Simulations based on our estimates show that a positive nutritional shock during the first six months of life is essentially depleted at the age of 2. Consequently, sustainable development and nutrition programs have to be long-term and yield higher returns if they reach babies in the early months of infancy.
    Keywords: Child health, Health production, Height-for-Age, Weight-for-Age, Dynamic Panel Regression, GMM
    JEL: I12 O12 D91
    Date: 2011–01–19
  4. By: Cinzia Di Novi (Dipartimento di Politiche Pubbliche e Scelte Collettive, Università del Piemonte Orientale, Italy)
    Abstract: Limited literature has been published on the association between environmental health indicators, life-style habits and ambient air pollution. We have examined the association of asthma prevalence and the amount of health investment with daily mean concentrations of particulate matter (PM) with a mass median aerodynamic diameter less than 2.5 mm (PM25) in 16 metropolitan areas in U.S. using the Behavioral Risk Factor Surveillance System (2001) data in conjunction with the Air Quality System data collected by the Environmental Protection Agency. A multivariate probit approach has been used to estimate recursive systems of equations for environmental health outcome and life-styles. A piecewise linear relationship has been postulated to describe the association between health outcome, health investment and pollution. We have assumed one change point at AQI value of 100 which corresponds to the US national air quality standard. The most interesting result concerns the influence of pollution on health-improving life-style choices: below a specified threshold concentration (AQI=100) a positive linear association exists between exposure to PM25 and health investments; above the threshold the association becomes negative. Hence, only if ambient pollution is in the `satisfactory range' (AQI level at or below 100), individuals will have incentive to invest in health.
    Keywords: : health production, multivariate probit, spline, life-style, fine particulate, asthma
    JEL: I12 C31 D13 D81 Q25
    Date: 2011–01
  5. By: Jonsson, Robert (Department of Economics)
    Abstract: CUSUM procedures which are based on standardized statistics are often supposed to have expectation zero and being normally distributed. If these conditions are not satisfied it can have serious consequences on the determination of proper alarming bounds and on the frequency of false alarms. Here a CUSUM method for detecting outbreaks in health events is presented when the latter are Poisson distributed. It is based on a standardized statistic with a bias from zero that can be neglected. The alar... moreming boundaries are determined from the actual distribution of the statistic rather than on normality assumptions. The boundaries are also determined from requirements on the probability of false alarms instead of the common practice to focus on average run lengths (ARLs). The new method is compared with other CUSUM methods in Monte Carlo simulations. It is found that the new method has about the same expected time to first motivated alarm and the same sensitivity. However, the new method has expected times to first false alarm that are 9 % – 90 % longer. The new method is applied to outbreaks of sick-listening and to outbreaks of Chlamydial infection.
    Keywords: Reference value k; sampling- and calibration periods
    JEL: C10
    Date: 2011–02–04
  6. By: Petrie , Dennis (Dept of Economics Studies, University of Dundee); Allanson, Paul (Dept of Economics Studies, University of Dundee); Gerdtham, Ulf-G (Department of Economics, Lund University)
    Abstract: This paper develops an accounting framework to consider the effect of deaths on the longitudinal analysis of income-related health inequalities. Ignoring deaths or using inverse probability weights to re-weight the sample for mortality-related attrition can produce misleading results. Incorporating deaths into the longitudinal analysis of income-related health inequalities provides a more complete picture in terms of the evaluation of health changes in respect to socioeconomic status. We illustrate our work by investigating health mobility from 1999 till 2004 using the British Household Panel Survey (BHPS). When deaths are explicitly incorporated into the analysis it is found that over this five year period the relative health changes were significantly regressive such that the poor experienced a larger share of the health losses relative to their initial share of health and a large amount of this was related to mortality.
    Keywords: QALYs; income-related health inequality; mobility analysis; longitudinal data; inverse probability weights
    JEL: D39 D63 I18
    Date: 2011–02–04
  7. By: Juan G. Gay; Valérie Paris; Marion Devaux; Michael de Looper
    Abstract: This study assesses the potential of the concept of “mortality amenable to health care” as an indicator of outcome for health care systems. It presents estimates of the mortality amenable to health care in 31 OECD countries for the period 1997-2007. It measures the sensitivity of this indicator to the list of death causes considered to be “amenable to care” by comparing results obtained from two leading lists. It then presents the advantages of this indicator over indicators of general mortality, as well as its limitations.<BR>Cette étude évalue dans quelle mesure l’indicateur de « mortalité évitable grâce au système de soins » peut être utilisé comme indicateur de résultat du système de soins. Elle présente des estimations de cette mortalité évitable par les soins pour 31 pays de l’OECD et pour la période 1997-2007. Elle mesure la sensibilité de l’indicateur à la liste de causes de décès considérées comme évitables par les soins en comparant les résultats obtenus à partir de deux listes alternatives. Puis, elle présente les avantages de cet indicateur sur les indicateurs de mortalité générale, ainsi que ses limites.
    JEL: I10 I12
    Date: 2011–01–31
  8. By: Brick, Aoife; Nolan, Anne; O'Reilly, Jacqueline; Smith, Samantha
    Date: 2010–10
  9. By: Gorecki, Paul K.
    Date: 2010–10
  10. By: Baum, Matthew A. (Harvard Kennedy School)
    Abstract: This study assesses the relationship between political partisanship and attitudes and behavior with respect to the Swine Flu crisis of 2009 in general, and the U.S. mass vaccination program in particular. I argue that even seemingly non-partisan political issues like public health are increasingly characterized by partisan polarization in public attitudes, and that such polarization is in part attributable, at least in part, to the breakdown of the information commons that characterized the American mass media from roughly the 1950s until the early 1990s. In its place has arisen an increasingly fragmented and niche-oriented media marketplace in which individuals are better able to limit their information exposure to attitudes and opinions that reinforce, rather than challenge, their preexisting beliefs. I test my argument against a variety of data sources, including opinion surveys and state level Swine Flu vaccination rate data.
    Date: 2011–01
  11. By: Ministry of Health and Family Welfare
    Abstract: The National Programme for the Health Care for the Elderly (NPHCE) is an articulation of the International and national commitments of the Government as envisaged under the UN Convention on the Rights of Persons with Disabilities (UNCRPD), National Policy on Older Persons (NPOP) adopted by the Government of India in 1999 & Section 20 of “The Maintenance and Welfare of Parents and Senior Citizens Act, 2007†dealing with provisions for medical care of Senior Citizen.
    Keywords: health care, elderly, NPHCE, older persons, persons, disabilities, India, senior citizen, welfare, parents,
    Date: 2011
  12. By: Bichaka Fayissa; Shah Danyal; J.S. Butler
    Abstract: Using the NLSY79 panel data set from 1979-2006 for a cross-section of 12,686 individuals, this paper investigates the effect of educational attainment on the health status of an individual as measured by “the inability to work for health reasons.” The present study bridges the gap in the literature by using the fixed-effects model, random-effects model, between-effects, and the Arellano-Bond dynamic model to analyze the impact of education on health status. We use these alternative models to control unobserved heterogeneity. Educational attainment has a statistically significant and positive effect on the quality of an individual’s health status.
    Keywords: Education, Health Status, Fixed-Effects, Random-Effects, Between-Effects, Arellano-Bond Model
    JEL: I12 I20
    Date: 2011–02
  13. By: Anna Alberini (University of Maryland, College Park, FEEM and Queen’s University Belfast); Milan Šcasný (Charles University Prague)
    Abstract: The Value of a Statistical Life is a key input into the calculation of the benefits of environmental policies that save lives. To date, the VSL used in environmental policy analyses has not been adjusted for age or the cause of death. Air pollution regulations, however, are linked to reductions in the risk of dying for cancer, heart disease, and respiratory illnesses, raising the question whether a single VSL should be applied for all of these causes of death. We conducted a conjoint choice experiment survey in Milan, Italy, to investigate this question. We find that the VSL increases with dread, exposure, the respondents’ assessments of the baseline risks, and experience with the specific risks being studied. The VSL is higher when the risk reduction is delivered by a public program, and increases with the effectiveness rating assigned by the respondent to public programs that address specific causes of death. The effectiveness of private risk-reducing behaviors is also positively associated with the VSL, but the effect is only half as large as that of public program effectiveness. The coefficients on dummies for the cause of death per se—namely, whether it’s cancer, a road traffic accident or a respiratory illness—are strongly statistically significant. All else the same, the fact that the cause of the death is “cancer” results in a VSL that is almost one million euro above the amount predicted by dread, exposure, beliefs, etc. The VSL in the road safety context is about one million euro less than what is predicted by dread, exposure, beliefs, etc. These effects are large, but the majority of the variation in the VSL is accounted for by the public program feature, the effectiveness of public programs at reducing the indicated risk, and dread. The effects of exposure and experience are smaller. These results raise the question whether using VSL figures based on private risk reduction, which is usually recommended to avoid double-counting, severely understates how much a society might be willing to pay for public safety.
    Keywords: VSL, Conjoint Choice Experiments, Mortality Risk Reductions, Cost-benefit Analysis, Forced Choice Questions
    JEL: I18 J17 K32 Q51
    Date: 2010–10
  14. By: Smith, N.R.
    Abstract: Previous research strongly suggests that ethnic minorities are more likely to suffer a poorer health profile compared to the overall population. Trends have emerged to suggest that social factors such as socioeconomic status and health behaviours are not fixed across generations and have a role to play in these inequalities in health. This thesis investigated the differences in ethnic inequalities in health between the first and second generations, and determined the extent to which intergenerational changes in socioeconomic status and health behavioural factors might explain any variation that exists. The study used ethnically‐boosted data from the third sweep of the Millennium Cohort Study (n=14,860) and the combined 1999 and 2004 Health Survey for England (n=28,628). Crosssectional analysis investigated generational differences in self rated general health, limiting illness, obesity, hypertension, depression, psychological distress and a range of biomarkers of cardiovascular disease, across the major ethnic minority groups in the UK (Indian, Pakistani, Bangladeshi, Black Caribbean, Black African, Irish, Chinese and Other). Children were additionally assessed for levels of cognitive development using the British Abilities Scales II. The generational change in socioeconomic circumstances (social class, highest educational qualification and household income) and the extent of acculturation (current smoking and drinking status, dietary behaviours and patterns of breastfeeding, immunisations and physical exercise) was examined. Strong upward intergenerational socioeconomic mobility in ethnic minority groups did not lead to improving health profiles. The second generation required greater levels of social advantage than the first generation to achieve the same level of health. Acculturative shifts led to a worsening in health behaviours, although the degree of change was highly ethnic group specific. Findings showed that the social and economic contexts, and the cultural identities and behaviours of ethnic minorities, differ across generations, but ultimately their opposing influences on health result in stable overall patterns of health inequality across generations.
    Date: 2010–02–28
  15. By: Morefield, G. Brant (University of North Carolina at Greensboro, Department of Economics); Ribar, David (University of North Carolina at Greensboro, Department of Economics); Ruhm, Christopher (University of Virginia)
    Abstract: We use longitudinal data from the 1984 through 2007 waves of the Panel Study of Income Dynamics to examine how occupational status is related to the health transitions of 30 to 59 year-old U.S. males. A recent history of blue-collar employment predicts a substantial increase in the probability of transitioning from very good into bad self-assessed health, relative to white-collar employment, but with no evidence of occupational differences in movements from bad to very good health. These findings are robust to a series of sensitivity analyses. The results suggest that blue-collar workers “wear out” faster with age because they are more likely, than their white-collar counterparts, to experience negative health shocks. This partly reflects differences in the physical demands of blue-collar and white-collar jobs.
    Keywords: occupations; physical demands; health; PSID
    JEL: I12 J24
    Date: 2011–02–03
  16. By: Paris Cleanthous
    Abstract: This paper formulates an empirical methodology that evaluates pharmaceutical innovation in the American antidepressant market by quantifying patient welfare benefits from innovation. While evaluating pharmaceutical innovation in antidepressants, I uncover and address the moral hazard issue that arises due to the existence of prescription drug insurance coverage. A combination of market-level data, drug and patient characteristics are used to estimate demand for all antidepressants between 1980 and 2001. The paper estimates large and varied patient welfare gains due to innovation and helps explain a detected divergence between social and private patient benefits by the existence of insurance.
    Keywords: Health, Innovation, Moral Hazard, Pharmaceuticals, Welfare
    Date: 2011–01
  17. By: Paris Cleanthous
    Abstract: This paper is an attempt to test country claims on the social costs of openness especially in the case of poor developing countries. The intent of this paper is to extend the research on the costs and benefits of economic openness by trying to look at one dimension in particular, health, and to answer two distinct but linked questions. How does openness affect government spending? What are the true determinants behind public health spending? The paper finds a positive relationship between openness and government size for poor, less developed countries, and negative in the case of rich, developed economies. The paper also finds that poor, less developed countries rank healthcare spending lower than defense but higher than education in government spending allocation and are, therefore, spending more than proportionately on healthcare than they are spending on defense and less than proportionately than on education.
    Keywords: Health, Public Health Expenditure, Government Expenditure, Openness
    Date: 2011–01
  18. By: Paris Cleanthous
    Abstract: Pharmaceutical markets are characterized by a high degree of innovation, complexity and uncertainty, especially markets of idiosyncratic symptomatolgy and response to treatment such as the antidepressant market. It may, therefore, be unreasonable to assume that consumers are aware of all antidepressants for sale at the time of purchase, as is the case in traditional models of consumer choice. Such an assumption will bias demand curves towards being more elastic and the evaluation of consumer welfare downwards. This paper, therefore, aims at analyzing and evaluating the effects of promotions by pharmaceutical firms on patient welfare taking into account the interaction of multiple agents (patients, physicians, insurance companies and pharmaceutical companies) in the decision process. I present an empirical discrete-choice model of limited information, where advertising influences the set of drugs from which a purchase choice is made. The estimation technique incorporates both macro- and micro-level data. Estimation results indicate that pharmaceutical firms use advertising media to target high-income households and households with more comprehensive prescription drug insurance schemes through their physicians or directly. Model comparison shows that limited information leads to less elastic demand curves and larger estimates of patient welfare due to pharmaceutical innovation that exacerbate the moral hazard issue that coexists with insurance coverage.
    Keywords: Advertising, Health, Information, Moral Hazard, Pharmaceuticals, Welfare
    Date: 2011–01
  19. By: James P. Smith; Yan Shen; John Strauss; Zhe Yang; Yaohui Zhao
    Abstract: In this paper, the authors model the consequences of childhood health on adult health and socioeconomic status outcomes in China using a new sample of middle aged and older Chinese respondents. Modeled after the American Health and Retirement Survey (HRS), the CHARLS Pilot survey respondents are forty-five years and older in two quite distinct provinces- Zhejiang, a high growth industrialized province on the East Coast and Gansu, a largely agricultural and poor province in the West. Childhood health in CHARLS relies on two measures that proxy for different dimensions of health during the childhood years. The first is a retrospective self-evaluation using a standard five-point scale (excellent, very good, good, fair, or poor) of general state of one's health when one was less than 16 years old. The second is adult height often thought to be a good measure of levels of nutrition during early childhood and the prenatal period. They relate both these childhood health measures to adult health and SES outcomes during the adult years. They find strong effects of childhood health on adult health outcomes particularly among Chinese women and strong effects on adult BMI particularly for Chinese men.
    Date: 2010–11
  20. By: Jinkook Lee
    Abstract: A growing number of countries are developing or reforming pension and health policies in response to population ageing and to enhance the welfare of their citizens. The adoption of different policies by different countries has resulted in several natural experiments. These offer unusual opportunities to examine the effects of varying policies on health and retirement, individual and family behavior, and well-being. Realizing these opportunities requires harmonized data-collection efforts. An increasing number of countries have agreed to provide data harmonized with the Health and Retirement Study in the United States. This paper discusses these data sets, including their key parameters of pension and health status, research designs, samples, and response rates. It also discusses the opportunities they offer for cross-national studies and their implications for policy evaluation and development.
    Date: 2010–11
  21. By: Jibum Kim; Jinkook Lee
    Abstract: This paper investigates how educational attainment may affect the prevalence of disability among older Koreans, a population for whom the association between health and education has been little studied. It performs descriptive and logistic regression analysis on five nationally representative data sets, all collected between 2004 and 2006, regarding education and disability among Koreans at least 65 years of age. It finds the relationship between education and disability to be strongest between less than primary school graduates and primary school graduates. Beyond the primary school level, the educational gradient on disability is weak.
    Date: 2010–11
  22. By: Vladimir Popov (New Economic School, Moscow)
    Abstract: This paper provides evidence from cross-regional comparisons that the Russian mortality crisis (mortality rate increased from 1.0% to 1.6% in 1989-94 and stayed at a level of 1.4- 1.6% thereafter) was caused mostly by stress factors (increased unemployment, labor turnover, migration, divorces, income inequalities), and by the increase in unnatural deaths (murders, suicides, accidents), but not so much by the increase in alcohol consumption (even though it also increased due to the same stress factors). Health infrastructure of a region had a positive impact on life expectancy only in regions with high income inequalities (large share of highest income group).
    Date: 2011–01
  23. By: Hlavac, Marek
    Abstract: In a recent research paper, health economists David Cutler and Adriana Lleras-Muney analyze data primarily from the National Health Interview Survey (NHIS), an annual cross-sectional household survey administered by the National Center for Health Statistics (NCHS) at the Centers for Disease Control and Prevention (CDC). They find that higher levels of education are associated with lower adult mortality rates, lower frequencies of self-reported incidence of chronic and acute diseases, better functioning and mental health, as well as with lower reports of lost work days or days spent in bed. In addition, they find that more education is associated with better health behaviors: Better-educated individuals smoke less, engage in less heavy drinking, wear seatbelts more often, and consume more preventive care. This comments discusses selected strengths and weaknesses of Cutler and Lleras-Muney's study.
    Keywords: education; health; health economics; adult mortality; health behavior; absenteeism
    JEL: I12 I20 I10
    Date: 2011–02

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