nep-hea New Economics Papers
on Health Economics
Issue of 2012‒09‒22
eleven papers chosen by
Yong Yin
SUNY at Buffalo, USA

  1. Musn’t Grumble. Immigration, Health and Health Service Use in the UK and Germany By Jonathan Wadsworth
  2. HETEROGENEITY IN EXPECTED LONGEVITIES By Josep Pijoan-Mas; José-Víctor Ríos-Rull
  3. Liability versus Regulation for Dangerous Products When Consumers Vary in Their Susceptibility to Harm and Misperceive Risk By Thomas J. Miceli; Rebecca Rabon; Kathleen Segerson
  4. Rising Inequalities in Income and Health in China: Who is left behind? By Steef Baeten; Tom Van Ourti; Eddy Van Doorslaer
  5. Long-Term Care and the Housing Market By Bell, David; Rutherford, Alasdair
  6. Essays on health and labor economics. By Hullegie, P.G.J.
  7. Labour market impacts from disability onset By Cain Polidano; Ha Vu
  8. The Long-Term Cognitive Consequences of Early Childhood Malnutrition: The Case of Famine in Ghana By Samuel K. Ampaabeng; Chih Ming Tang
  9. Health and Wealth: Short Panel Granger Causality Tests for Developing Countries By Judith A. Clarke; Nilanjana Roy; Weichun Chen
  10. A Warrant for Pain: Caveat Emptor vs. the Duty of Care in American Medicine, c. 1970-2010 By Avner Offer
  11. Quantitative analysis of health insurance reform: separating regulation from redistribution By Pashchenko, Svetlana; Porapakkarm, Ponpoje

  1. By: Jonathan Wadsworth (Royal Holloway College, Centre for Economic Performance at the London School of Economics; Centre for Analysis and Research on Migration at UCL and IZA, Bonn)
    Abstract: A rise in population caused by increased immigration, is sometimes accompanied by concerns that the increase in population puts additional or differential pressure on welfare services which might affect the net fiscal contribution of immigrants. The UK and Germany have experienced significant increases in immigration in recent years and this study uses longitudinal data from both countries to examine whether immigrants differ in their use of health services than native born individuals on arrival and over time. While immigrants to Germany, but not the UK, are more likely to self-report poor health than the native-born population, the samples of immigrants use hospital and GP services at broadly the same rate as the native born populations in both countries. Controls for observed and unobserved differences between immigrants and native-born sample populations make little difference to these broad findings.
    Keywords: Immigration, Health, Health Service
    JEL: H00 J00
    Date: 2012–09
  2. By: Josep Pijoan-Mas (CEMFI, Centro de Estudios Monetarios y Financieros); José-Víctor Ríos-Rull (University of Minnesota)
    Abstract: We develop a new methodology to compute differences in the expected longevity of individuals who are in different socioeconomic groups at age 50. We deal with the two main problems associated with the standard use of life expectancy: that people's socioeconomic characteristics evolve over the life cycle and that there is a time trend that reduces mortality over time. Using HRS data we uncover an enormous amount of heterogeneity in expected longevities between individuals in different socioeconomic groups. Additionally, our analysis allows us to provide an answer to the old question of how health protecting are education, wealth and marital status. To do so, we decompose the longevity differentials into differences in health at age 50, differences in the evolution of health with age, and differences in mortality conditional on health. Remarkably, the latter is the least important for most socioeconomic characteristics. In particular, education and wealth are health protecting but have very little impact on two-year mortality rates conditional on health. Finally, we document an increasing time trend of the socioeconomic gradient of longevity in the period 1992-2008, and a likely increase in the socioeconomic gradient of mortality rates in the near future. Last but not least, we show that the longevity differences that we find have welfare implications that dwarf the differences in consumption accruing to people in different socioeconomic groups.
    Keywords: Inequality in health, Heterogeneity in mortality rates, Life expectancies.
    JEL: I14 I24 J12 J14
    Date: 2012–09
  3. By: Thomas J. Miceli (University of Connecticut); Rebecca Rabon (University of Connecticut); Kathleen Segerson (University of Connecticut)
    Abstract: When consumers vary in their susceptibility to product-related harm, safety regulation dominates liability because when consumers bear their own damages they are induced to selfselect in their purchase decisions. When consumers also misperceive risk, however, liability may be preferred because the price of the product accurately conveys the risk, thereby eliminating any distortions due to misperception. Generally, regulation is preferred when consumers accurately perceive risk, and liability is preferred when they do not. JEL Classification: K13, L51 Key words: Products liability, regulation, risk perceptions
    Date: 2012–08
  4. By: Steef Baeten (Institute for Health Policy and Management, Erasmus University Rotterdam); Tom Van Ourti (Erasmus School of Economics (EUR)); Eddy Van Doorslaer (Erasmus School of Economics (EUR))
    Abstract: During the last decades, China has experienced double-digit economic growth rates and rising inequality. This paper implements a new decomposition on the China Health and Nutrition panel Survey (1991-2006) to examine the extent to which changes in level and distribution of incomes and in income mobility are related to health disparities between rich and poor. We find that health disparities in China relate to rising income inequality and in particular to the adverse health and income experience of older (wo)men, but not to the growth rate of average incomes over the last decades. These findings suggest that replacement incomes and pensions at older ages may be one of the most important policy levers in combating health disparities between rich and poor Chinese.
    Keywords: China; income growth; income inequality; income mobility; health inequality
    JEL: C00 D30 D63 I14 I15
    Date: 2012–09–10
  5. By: Bell, David; Rutherford, Alasdair
    Abstract: This paper examines the combined effects of population ageing and changes in long-term care policy on the housing market. Those needing care prefer to receive it at home rather than in institutional settings. Public authorities prefer to provide care in residential settings which are generally lower cost than institutional care. The trend away from institutional provision towards care at home is endorsed by national governments and by the OECD. Nevertheless, as the number requiring care increases, this policy shift will maintain the level of housing demand above what it would otherwise be. It will also have distributional consequences with individuals less likely to reduce their housing equity to pay for institutional care, which in turn will increase the value of their bequests. Empirical analysis using the UK Family Resources Survey and the British Household Panel Survey shows that household formation effects involving those requiring long-term care are relatively weak and unlikely to significantly offset the effects of this policy shift on the housing market and on the distribution of wealth.
    Keywords: Ageing; Demographic change; Housing market; Long-term care
    Date: 2012–06
  6. By: Hullegie, P.G.J. (Tilburg University)
    Abstract: Abstract: This thesis deals with a range of topics in health and labor economics. The first part examines the validity of a method that aims at improving the interpersonal comparability of self-reports in surveys. The second part is concerned with the question how the demand for medical care is related to health insurance, and to health. The third part studies whether job search requirements help older workers to find a job more quickly.
    Date: 2012
  7. By: Cain Polidano; Ha Vu
    Abstract: In this paper we estimate the causal impacts of disability onset on labour market outcomes up to four years after onset using longitudinal data from the Household Income and Labour Dynamics Australia (HILDA) survey and difference-in-difference propensity score matching techniques. We find lasting negative impacts on full-time employment, which is linked more to people foregoing opportunities to move to full-time work rather than downshifting from full-time to part-time work. Impacts are greater for those without post-school qualifications because they face poor prospects once dislocated from work. These results point to the importance of prevention and vocational rehabilitation programs that are targeted at lowskilled workers.
    JEL: J20 I10
    Date: 2012–09
  8. By: Samuel K. Ampaabeng (Department of Economics, Clark University, USA); Chih Ming Tang (Department of Economics, Clark University, USA)
    Abstract: We examine the role of early childhood health in human capital accumulation. Using a unique data set from Ghana with comprehensive information on individual, family, community, school quality characteristics and a direct measure of intelligence together with test scores, we examine the long-term cognitive effects of the 1983 famine on survivors. We show that differences in intelligence test scores can be robustly explained by the differential impact of the famine in different parts of the country and the impacts are most severe for children under two years of age during the famine. We also account for model uncertainty by using Bayesian Model Averaging.
    Keywords: cognitive development, early childhood malnutrition, famine, Bayesian model averaging, Ghana
    JEL: C11 C26 C52 I15 I25 O12 O15 O55
    Date: 2012–09
  9. By: Judith A. Clarke (Department of Economics, University of Victoria); Nilanjana Roy (Department of Economics, University of Victoria); Weichun Chen
    Abstract: The world has experienced impressive improvements in wealth and health, with, for instance, the world’s real GDP per capita having increased by 180% from 1970 to 2007 accompanied by a 50% decline in infant mortality rate. Healthier and wealthier. Are health gains arising from wealth growth? Or, has a healthier population enabled substantial growth in wealth? The answers to these questions have serious policy implications. We contribute to understanding dynamic links between wealth and health by analyzing the relationship between health (as measured by infant mortality rate) and wealth (as measured by GDP per capita) for a panel of 58 developing countries using quinquennial data covering the period 1960 through 2005. We examine for causal rather than associative links between these fundamental macro measures of economic development. The panel enables us to examine for causal links using several methods that differ in how cross-country and temporal heterogeneity is imposed: cross-country homogeneity with temporal heterogeneity and cross-country heterogeneity with temporal homogeneity. Under the latter case, we consider sensitivity to assuming fixed versus random causal coefficients. In addition, we explore robustness of outcomes to level of economic development (as measured by national income) and inclusion of another covariate (education).
    Keywords: infant mortality; per capita GDP; Granger causality; fixed and random causal coefficients
    JEL: O11 I15 C33
    Date: 2012–09–12
  10. By: Avner Offer (All Souls College, University of Oxford)
    Abstract: Bad ethics can make for bad economic outcomes. Bad ethics are defined hedonically as the infliction of pain on others for private advantage. The infliction of pain is often justified by ‘Just World Theories’, which state that everyone gets what they deserve. Market liberalism (and its theoretical underpinning in neoclassical economics) is one theory of this kind. As an example, the micro and macro underperformance of the American health system c. 1970-2010 is explained in terms of the shift in policy norms from the fiduciary norm "first do no harm" to the neo-liberal market norm of "let the buyer beware" (caveat emptor) since the 1970s.
    Date: 2012–07–20
  11. By: Pashchenko, Svetlana; Porapakkarm, Ponpoje
    Abstract: Two key components of the upcoming health reform in the U.S. are a new regulation of the individual health insurance market and an increase in income redistribution in the economy. Which component contributes more to the welfare outcome of the reform? We address this question by constructing a general equilibrium life cycle model that incorporates both medical expenses and labor income risks. We replicate the key features of the current health insurance system in the U.S. and calibrate the model using the Medical Expenditures Panel Survey dataset. We find that the reform decreases the number of uninsured more than twice and generates substantial welfare gains. However, these welfare gains mostly come from the redistributive measures embedded in the reform. If the reform only reorganizes the individual market, introduces individual mandates but does not include any income-based transfers, the welfare gains are much smaller. This result is mostly driven by the fact that most uninsured people have low income.
    Keywords: health insurance; health reform; risk sharing; general equilibrium
    JEL: E65 D91 D52 E21 I10
    Date: 2012–08–17

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