nep-hea New Economics Papers
on Health Economics
Issue of 2011‒02‒26
thirteen papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. Public health movements, local poor relief and child mortality in American cities: 1923-1932 By Jonathan Fox
  2. The social economic impact of AIDS: Accounting for intergenerational transmission, productivity and fertility By Chrysovalantis VASILAKIS
  3. Coherent mortality forecasting: the product-ratio method with functional time series models By Rob J Hyndman; Heather Booth; Farah Yasmeen
  4. A Labor Market Approach to the Crisis of Health Care Professionals in Africa By Andalón, Mabel; Fields, Gary
  5. Occupational Status and Health Transitions By Morefield, G. Brant; Ribar, David C.; Ruhm, Christopher J.
  6. Putting Different Price Tags on the Same Health Condition: Re-evaluating the Well-Being Valuation Approach By Powdthavee, Nattavudh; van den Berg, Bernard
  7. What Business Should Know About the Patient Protection and Affordable Care Act By Swenson, David A.
  8. Measuring Socioeconomic Inequality in Health, Health Care and Health Financing by Means of Rank-Dependent Indices: A Recipe for Good Practice By Guido Erreygers; Tom Van Ourti
  9. Effect of Internet Health Information on Health Care Use By Agne Suziedelyte
  10. A Theoretical Approach to Dual Practice Regulations in the Health Sector By Paula González; Inés Macho-Stadler
  11. The Impact of National Health Insurance on Birth Outcomes: A Natural Experiment in Taiwan By Shin-Yi Chou; Michael Grossman; Jin-Tan Liu
  12. The Impact of Early Occupational Choice On Health Behaviors By Inas Rashad Kelly; Dhaval M. Dave; Jody L. Sindelar; William T. Gallo
  13. Existence and Magnitude of Health-related Externalities: Evidence from a Choice Experiment By Jeremiah Hurely; Emmanouil Mentzakis

  1. By: Jonathan Fox
    Abstract: This paper examines the effectiveness of the public health education and poverty relief programs prior to the New Deal. Prior researchers have speculated that these programs contributed to the declining mortality rates during the 1920s, but have been unable to econometrically estimate their impact. This paper uses new data on municipal health education expenditures, as well as data on spending to relieve poverty, to separately estimate how effective each of these different types of programs were at reducing child mortality. A panel of 67 cities over 10 years is created, and the effects are identified using the variation within cities over time, after controlling for nation-wide shocks to the system. Fixed effects estimations suggest that spending on both health education and poverty relief were relatively low cost ways to reduce mortality for infants and school age children. Additionally, spending on public health education was extremely cost effective at reducing infant and child mortality rates, with about $27,000 2007 dollars associated with an infant death averted. This supports assertions by prior researchers that education and changing behaviors was the primary reason for falling infant and child mortality in the early twentieth century.
    Keywords: USA, health education, infant mortality, public health
    JEL: J1 Z0
    Date: 2011–02
  2. By: Chrysovalantis VASILAKIS (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))
    Abstract: In this paper we develop a model that aims to investigate the economic and demographic impacts of three effects of the HIV-AIDS epidemic in developing countries. The direct effect of the HIV epidemic is that it hits the inherited characteristics of young adults. The two indirect effects, resulting from the first, are the reduction in productivity of adults and the transmission of the disease to their offsprings. We allow these different effects to act either separately or together, and we investigate the marginal efficiency of health expenditures on the survival probability of individuals and demographics. The direct effect of the HIV virus is that it leads adults to increase their own health expenditure and to decrease that of their children. On the contrary, the transmission effect of the HIV virus leads parents to spend more on their children than on their own. We show that the reduction in productivity of young adults decreases health expenditures for themselves and their children. Furthermore, we find that the productivity effect dominates by large the two others. Moreover, when adults decide to have fewer children because of HIV, we show that the ratio of low to high skilled workers increases. This demographic impact impoverishes the economy in the short and medium run.
    Keywords: orphans, epidemic, transmission, productivity shock, survival rate
    Date: 2010–12–21
  3. By: Rob J Hyndman; Heather Booth; Farah Yasmeen
    Abstract: When independence is assumed, forecasts of mortality for subpopulations are almost always divergent in the long term. We propose a method for non-divergent or coherent forecasting of mortality rates for two or more subpopulations, based on functional principal components models of simple and interpretable functions of rates. The product-ratio functional forecasting method models and forecasts the geometric mean of subpopulation rates and the ratio of subpopulation rates to product rates. Coherence is imposed by constraining the forecast ratio function through stationary time series models. The method is applied to sex-specific data for Sweden and state-specific data for Australia. Based on out-of-sample forecasts, the coherent forecasts are at least as accurate in overall terms as comparable independent forecasts, and forecast accuracy is homogenised across subpopulations.
    Keywords: Mortality forecasting, coherent forecasts, functional data, Lee-Carter method, life expectancy, mortality, age pattern of mortality, sex-ratio
    JEL: J11 C53 C14
    Date: 2011–02–04
  4. By: Andalón, Mabel (University of Melbourne); Fields, Gary (Cornell University)
    Abstract: This paper adopts a labor market economics perspective to understanding the crisis of health care professionals in Africa. Five challenges resulting from this crisis are identified: a production challenge, an underutilization challenge, a distributional challenge, a performance challenge, and a financing challenge. Differences between the labor market approach and others used in the health field are noted. We conclude that more empirical data, a full labor market analysis, and the use of social benefit-cost criteria are all needed before policy recommendations to address any of these challenges can be confidently offered.
    Keywords: labor market, health care, Africa
    JEL: I11 J01 J08
    Date: 2011–02
  5. By: Morefield, G. Brant (University of North Carolina, Greensboro); Ribar, David C. (University of North Carolina, Greensboro); Ruhm, Christopher J. (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
    JEL: I12 J24
    Date: 2011–02
  6. By: Powdthavee, Nattavudh (University of York); van den Berg, Bernard (University of York)
    Abstract: Many recent writings in health policy have proposed that health be valued directly and in monetary terms using the new well-being valuation method. Yet there is currently no clear consensus on what the best measure of individual’s experience may be for the evaluation process. To shed light on this issue, monetary values for a number of health problems are compared across different well-being measures within the same UK data set. We find that, while there is strong internal consistency of health impacts within each well-being measure, hugely different monetary valuations are obtained for the same health problem across different well-being measures. Our results, although should only viewed as illustrative, call for economists to rethink about which measure of well-being or experienced utility to be used in the well-being valuation method, should the approach ever be implemented in real policy contexts.
    Keywords: well-being, compensation variations, monetary valuations, happiness, health, GHQ
    JEL: H8 I18 I31
    Date: 2011–02
  7. By: Swenson, David A.
    Date: 2011–02–21
  8. By: Guido Erreygers (University of Antwerp, Antwerp, Belgium); Tom Van Ourti (Erasmus University Rotterdam, and NETSPAR)
    Abstract: The tools to be used and other choices to be made when measuring socioeconomic inequalities with rank-dependent inequality indices have recently been debated in this journal. This paper adds to this debate by stressing the importance of the measurement scale, by providing formal proofs of several issues in the debate, and by lifting the curtain on the confusing debate between adherents of absolute versus relative health differences. We end this paper with a "matrix" that provides guidelines on the usefulness of several rank-dependent inequality indices under varying circumstances
    Keywords: Health inequality; Socioeconomic inequality; Concentration Index
    JEL: D63 I10
    Date: 2010–08–03
  9. By: Agne Suziedelyte (School of Economics, The University of New South Wales)
    Abstract: This study estimates the effect of Internet health information on health care utilisation. The causal variable of interest is a binary variable that indicates whether or not an individual has used the Internet to search for health information. Health care utilisation is measured by an individual's number of visits to a health professional. I use the variation in telecommunication laws of U.S. states as a novel instrument to identify the causal effect. The analysis results show that, on average, using the Internet as health information source increases the utilisation of health care. The effect is quantitatively large and precisely estimated. An ordinary least squares regression underestimates the effect, even after controlling for a number of observed individual characteristics.
    Keywords: Health care; Health information; Internet
    JEL: I1
    Date: 2010–11
  10. By: Paula González (Department of Economics, Universidad Pablo de Olavide); Inés Macho-Stadler (Department of Economics, Universidad Autónoma de Barcelona)
    Abstract: Internationally, there is wide cross-country heterogeneity in government responses to dual practice in the health sector. This paper provides a uniform theoretical framework to analyze and compare some of the most common regulations. We focus on three interventions: banning dual practice, offering rewarding contracts to public physicians, and limiting dual practice (including both limits to private earnings of dual providers and limits to involvement in private activities). An ancillary objective of the paper is to investigate whether regulations that are optimal for developed countries are adequate for developing countries as well. Our results offer theoretical support for the desirability of different regulations in different economic environments.
    Keywords: Dual practice, optimal contracts, physicians' incentives, regulations.
    JEL: I11 I18 L51 H51
    Date: 2011
  11. By: Shin-Yi Chou; Michael Grossman; Jin-Tan Liu
    Abstract: We estimate the impacts of the introduction of National Health Insurance (NHI) in Taiwan in March 1995 on the health of infants. Prior to NHI, government workers (the control group) possessed health insurance policies with comprehensive coverage for births and infant medical care services. Private sector industrial workers and farmers (the treatment groups) lacked this coverage. All households received coverage for the services just mentioned as of March 1995. Since stringent requirements for reporting births introduced in 1994 produced artificial upward trends in early infant deaths, we focus on postneonatal mortality (deaths from the 28th through the 364th day of life per thousand survivors of the first 27 days of life). We find that the introduction of NHI led to reductions in this rate for infants born in farm households but not for infants born in private sector households. For the former group, the rate fell by 0.5 deaths per thousand survivors or by 13 percent relative to the mean in the pre-NHI period of 4 deaths per thousand survivors. An especially large decline of 6 deaths per thousand survivors occurred for pre-term infants-- a 36 percent drop relative to the pre-NHI mean of 17 deaths per thousand survivors.
    JEL: I10 I11 I12 I18
    Date: 2011–02
  12. By: Inas Rashad Kelly; Dhaval M. Dave; Jody L. Sindelar; William T. Gallo
    Abstract: Occupational choice is a significant input into individuals’ health investments, operating in a manner that can be either health-promoting or health-depreciating. Recent studies have highlighted the potential importance of initial occupational choice on subsequent outcomes pertaining to morbidity. This study is the first to assess the existence and strength of a causal relationship between initial occupational choice at labor entry and subsequent health behaviors and habits. We utilize the Panel Study of Income Dynamics to analyze the effect of first occupation, as identified by industry category and blue collar work, on subsequent health outcomes relating to body mass index, obesity, alcohol consumption, and physical activity in 1999-2005. Our findings suggest that initial occupations described as craft, operative, and service are related to higher body mass index and obesity later in life, while labor occupations are related to higher probabilities of smoking later in life. Blue collar work early in life is associated with increased probabilities of obesity and smoking, and decreased physical activity later in life, although effects may be masked by unobserved heterogeneity. Few effects are found for the effect of initial occupation on alcohol consumption. The weight of the evidence bearing from various methodologies, which account for non-random unobserved selection, indicates that at least part of this effect is consistent with a causal interpretation. These estimates also underscore the potential durable impact of early labor market experiences on later health.
    JEL: I0
    Date: 2011–02
  13. By: Jeremiah Hurely; Emmanouil Mentzakis
    Abstract: Health-related external benefits are of potentially large importance for public policy. This paper investigates health-related external benefits using a stated-preference discrete-choice experiment framed in a health care context and including choice scenarios dened by six attributes related to the a recipient and the recipient's condition: communicability, severity, medical necessity, relationship to respondent, location, and amount of contribution requested. Subjects also completed a set of own-treatment scenarios and a values-orientation instrument. We find evidence of substantial health-related external benefits that vary as expected with the scenario attributes and subjects' value orientations. The results are consistent with a number of hypotheses offered by the general theoretical analysis of health-related externalities and the analysis of externalities specific to health care.
    Keywords: externalities; altruism; health care financing; program evaluation
    JEL: H23 I18 C91
    Date: 2011–02

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