nep-hea New Economics Papers
on Health Economics
Issue of 2015‒10‒04
twenty-one papers chosen by
Yong Yin
SUNY at Buffalo

  1. An Implementation Analysis of States' Experiences in Transitioning "Stairstep" Children from Separate CHIP to Medicaid By Cara Orfield; Sean Orzol; Lauren Hula
  2. Behavioural, Financial, and Health & Medical Economics By Chia-Lin Chang; Michael McAleer
  3. Birth Order and Health of Newborns: What Can We Learn from Danish Registry Data? By Anne Ardila Brenøe; Ramona Molitor
  4. E-Cigarettes: The Extent and Impact of Complementary Dual-Use By Doyle, Chris; Ronayne, David; Sgroi, Daniel
  5. Economic Activity and the Spread of Viral Diseases: Evidence from High Frequency Data By Adda, Jérôme
  6. Economic Freedom and Participation in Physical Activity By Joshua C. Hall; Brad R. Humphreys; Jane E. Ruseski
  7. Family Caregiving: 20 Years of Federal Policy By Debra Lipson
  8. Folic acid advisories, a public health challenge? By Herrera-Araujo, D.;
  9. Getting a healthy start: The effectiveness of targeted benefits for improving dietary choices By Griffith, R.;; von Hinke, S.;; Smith, S.;
  10. Inequality of Opportunity in Health and Cognitive Abilities: The Case of Chile. By Rafael Carranza; Daniel Hojman
  11. Modeling and projecting mortality. A new model of heterogeneity and selection in survivorship By Hans Oluf Hansen
  12. Optimal Health Insurance in the Presence of Risky Health Behaviors By Osman Furkan Abbasoglu
  13. Red Herring in the Vistula River: Time-to-Death and Health Care Expenditure By Maciej Lis
  14. Research Ideas for the Journal of Health & Medical Economics: Opinion By Chia-Lin Chang; Michael McAleer
  15. Socioeconomic status and health: A new approach to the measurement of bivariate inequality By ERREYGERS, Guido; KESSELS, Roselinde
  16. Some Explanation of Disparities of Mortality Rates of Working Age Population in Eastern, Central and Western Europe By Maria Lacko
  17. The Fatal Consequences of Grief By Bernhard Schmidpeter
  18. The future’s so bright, I gotta wear sunscreen: Dispositional optimism and preferences for prioritizing health care By LUYTEN, Jeroen; DESMET, Pieter; KESSELS, Roselinde; GOOS, Peter; BEUTELS, Philippe
  19. The perception of road safety communication campaigns: the gender influence By Helena Sofia Rodrigues; Manuel Fonseca; Paulo Ribeiro Cardoso
  21. What Can We Learn About the Effects of Food Stamps on Obesity in the Presence of Misreporting? By Lorenzo Almada; Ian M. McCarthy; Rusty Tchernis

  1. By: Cara Orfield; Sean Orzol; Lauren Hula
    Abstract: This report describes strategies for planning and implementing the transition, as well as challenges experienced, in ten states. The practices identified could inform how any future large-scale transitions of children’s coverage are implemented.
    Keywords: Medicaid, CHIP, transitions in coverage
    JEL: I
    Date: 2015–09–03
  2. By: Chia-Lin Chang (National Chung Hsing University, Taichung, Taiwan); Michael McAleer (National Tsing Hua University,Hsinchu, Taiwan, Erasmus School of Economics, Erasmus University Rotterdam, Tinbergen Institute, the Netherlands, and Complutense University of Madrid, Spain)
    Abstract: The paper reviews some of the literature in behavioural and financial economics that are related to health & medical economics. We then discuss some of the research on behavioural and financial economics that could be extended to health & medical economics beyond the existing areas in theory, statistics and econometrics.
    Keywords: Behavioural economics; Financial economics; Health & medical economics; Theory; Statistics; Econometrics
    JEL: G02 I11 O16 P34
    Date: 2015–09–28
  3. By: Anne Ardila Brenøe (Department of Economics, University of Copenhagen); Ramona Molitor (Department of Business Administration University of Copenhagen and Economics, University of Passau)
    Abstract: Research has shown a strong negative correlation between birth order and cognitive test scores, IQ, and educational outcomes. We ask whether birth order differences in health are present at birth using matched administrative data for more than 1,000,000 children born in Denmark between 1981 and 2010. Using family fixed effects models, we find a positive and robust birth order effect; earlier born children are less healthy at birth. Looking at the potential mechanisms, we find that during earlier pregnancies women have higher labor market attachment, behave more risky in terms of smoking, receive more prenatal care, and are diagnosed with more medical pregnancy complications. Yet, none of these factors explain the birth order differences at birth. Combining our results with findings from the medical literature, we propose that biology is driving the early life advantage (nature). Finally, we show that these birth order differences at birth do not explain the negative birth order effect in educational performace, suggesting that nurture rather than nature is an important player later in life.
    Keywords: Birth order, parity, child health, fetal health, health at birth, education
    JEL: I10 I12 J12 J13
    Date: 2015–09–22
  4. By: Doyle, Chris (Warwick Policy Lab and Department of Economics University of Warwick); Ronayne, David (Warwick Policy Lab and Department of Economics University of Warwick); Sgroi, Daniel (Warwick Policy Lab and Department of Economics University of Warwick,)
    Abstract: The highly controversial e-cigarette industry has generated considerable policy debate and mixed regulatory responses worldwide. Surprisingly, an issue that has been largely ignored is the categorisation of e-cigarettes as substitutes or (dynamic) complements for conventional smoking. We conduct an online survey of US participants finding that 37% of e-cigarette users view them primarily as complementary. We use this result along-side publicly available data to calibrate a cost-benefit analysis, estimating that complementarity reduces the potential cost-savings of e-cigarettes by as much as 57% (or $3.3-4.9bn p.a.) relative to case with zero complementarity. JEL classification: I12 ; I18 ; L66
    Keywords: e-cigarettes ; smoking ; dual-use ; dynamic complements ; cost-benefit analysis
    Date: 2015
  5. By: Adda, Jérôme
    Abstract: Viruses are a major threat to human health, and - given that they spread through social interactions - represent a costly externality. This paper addresses three main issues: i) what are the unintended consequences of economic activity on the spread of infections? ii) how efficient are measures that limit interpersonal contacts? iii) how do we allocate our scarce resources to limit their spread? To answer these questions, we use novel high frequency data from France on the incidence of a number of viral diseases across space, for different age groups, over a period of a quarter of a century. We use quasi-experimental variation to evaluate the importance of policies reducing inter-personal contacts such as school closures or the closure of public transportation networks. While these policies significantly reduce disease prevalence, we find that they are not cost-effective. We find that expansions of transportation networks have significant health costs in increasing the spread of viruses and that propagation rates are pro-cyclically sensitive to economic conditions and increase with inter-regional trade.
    Keywords: health; public policy; spatial diffusion; transportational networks
    JEL: C23 H51 I12 I15 I18
    Date: 2015–09
  6. By: Joshua C. Hall (West Virginia University, Department of Economics); Brad R. Humphreys (West Virginia University, Department of Economics); Jane E. Ruseski (West Virginia University, Department of Economics)
    Abstract: Physical activity is an important part of a healthy lifestyle and influences a variety of health outcomes. Across countries, economic freedom has been found to be positively associated with greater participation in physical activity and well-being. We empirically investigate the relationship between economic freedom and physical activity across U.S. states. Contrary to the cross-country results, we find that states with higher levels of economic freedom have lower rates of participation in physical activity.
    Keywords: economic freedom, health outcomes, physical activity
    JEL: I12 I18 J22 R5
    Date: 2015–06
  7. By: Debra Lipson
    Abstract: Family caregivers are a hidden workforce that is essential to meet the growing demand for long-term services and supports by older adults and people with disabilities.
    Keywords: Family Caregiving, Federal Policy, Long-term Services and supports
    JEL: I
    Date: 2015–10–01
  8. By: Herrera-Araujo, D.;
    Abstract: Neural tube defects are neurological conditions affecting 1 in 1000 foetuses in France each year. If a foetus is affected there is a 90% chance of the pregnancy being terminated. Increasing folic acid intake over 400μg per day two months before and two months after conception reduces prevalence rates by 80%. Two types of government interventions exist to increase intake and reduce prevalence rates: (1) fortification of staple food, which increases population intake indiscriminately; (2) social marketing seeking to increase intake of conceiving women through information provision. France opted for the latter and has implemented it since mid-2005. This paper sets up a quasi-experimental setting to measure the impact of the french social marketing campaign on consumption using a reduced form approach. I combine a detailed scanner data on grocery purchases with a dataset on macro- and micro- nutrients. Identification exploits the variation in the usefulness of folic acid information between households: households that are conceiving or want to conceive a child use it, while those that are not conceiving do not. Results suggest evidence of a positive impact of the information policy on folic acid household availability and preferences. A value per statistical life for children is found to be at least of e 17 millions.
    Keywords: Folic acid; health information; structural demand estimation; public health;
    JEL: C21 D12 I12 I18 J17
    Date: 2015–09
  9. By: Griffith, R.;; von Hinke, S.;; Smith, S.;
    Abstract: There is growing policy concern with encouraging better dietary choices. We show that a nationally-implemented voucher policy - the UK Healthy Start Scheme - increased spending on fruit and vegetables by 15 percent. However, the effects were heterogeneous: only households that previously spent less than the value of the voucher increased spending; the voucher was equivalent to a cash benefit for households already spending more than this value. These responses are in line with standard economic predictions. Although aspects of the policy might have been expected to stimulate a wider behavioural response, there is no evidence for this.
    Keywords: dietary choices; targeted benefits; healthy start scheme;
    JEL: D12 I18
    Date: 2015–09
  10. By: Rafael Carranza; Daniel Hojman
    Abstract: This paper studies inequality of opportunity in health in Chile. Following Roemer’s approach to equality of opportunity, we separate the effect of circumstances and efforts -healthy behaviors- on self-assessed health. In addition to parental and family background, our set of circumstances includes a proxy of numeracy skills. We find that circumstances explain nearly 40 percent of the variance of health outcomes, four times the contribution of efforts. More than one third of the contribution of circumstances is due to numeracy skills, similar to the contribution of parental education. Parents’ longevity is also important but its contribution is smaller. The overall influence of circumstances on inequality is substantial, ranging from 62 to more than 90 percent depending on the inequality index used. Overall, we find that health inequality is higher in Chile than in European countries and the contribution of unequal opportunities to inequality is at least as large. Our results also highlight the importance of cognitive ability on health inequality.
    Date: 2015–10
  11. By: Hans Oluf Hansen (Department of Economics, University of Copenhagen)
    Abstract: The demographic and epidemiological literature offers abundant examples of a range of shortcomings of statistical modeling to describe mortality by sex, age, time/cohort, and cause-of-death. Statistical modeling of mortality operating with implicitly homogenous sub-groupings exposed to mortality risk fails to consider latent biological heterogeneity at the level of individuals, and thereby important biological and social selection of survivorship. Defined on the state space of the simple life model, this study presents a proportional hazard model that makes up for such drawbacks as far as latent biological heterogeneity is concerned. The model describes heterogeneity and selection in individual survivorship by iterative stochastic micro simulation using cohort-based population mortality as an empirical benchmark. The model offers efficient linkage between past assorted mortality, on one hand, and informed anticipation of future heterogeneous survivorship, on the other hand. The combination of stochastic micro-simulation and log-linear modeling of the period effect or trend uncovered under the model makes the new Heterogeneity and Selection Model a powerful analytic and predictive tool of survivorship. Postulating a trend independent of age makes the popular Lee-Carter model (1992) unfit for professional demographic and actuarial use. Moreover, by sweeping latent biological heterogeneity under the rug, mortality analysis and projection based on central rates such as the Lee-Carter model (1992) underrates mortality in the mature and elderly ages. This is demonstrated by comparing current official mortality projections of Sweden, Denmark, and England & Wales to a set of alternative mortality projections under the Heterogeneity and Selection Model.
    Keywords: biodemography, heterogeneity and selection, stochastic micro-simulation, projection of survivorship
    JEL: J1 J11 J11 J14 J17
    Date: 2015–09–22
  12. By: Osman Furkan Abbasoglu
    Abstract: This paper develops a model of risky health behaviors to explore the optimal cost-sharing mechanism in a single provider health insurance system in which everyone contributes the same amount. In this economy, health insurance provides coverage against controllable health outcomes, and idiosyncratic health shocks. The model is calibrated to the U.S. economy using the Medical Expenditures Panel Survey dataset. I find that the optimal set of policies is the one in which workers pay 30 percent of their health care bills while retirees pay 20 percent. Welfare gains mostly come from the healthy who prefers less generous health insurance policies.
    Keywords: Health insurance, Life cycle model, Medical expenditures
    JEL: D91 E60 I12
    Date: 2015
  13. By: Maciej Lis
    Abstract: The aim of the article is to quantify the role of time-to-death in shaping health care costs. By combining a detailed break-down of population-wide data on publicly financed health care expenditure with the population and mortality data we are able to estimate a flexible model of live-cycle healthcare expenditure. We show that introducing time to death into the model enables the health care costs model to fit data perfectly. Our results confirm that the cumulative costs of health care over life-span depend on the age of death to a limited extend. As a result, the effect of rising life expectancy has a minor impact on HCE. However, the transitional effect of the changing age structure of the population should affect the aggregate health care expenditure.
    Keywords: healthcare expenditure, ageing, red herring
    JEL: H51 I12 I18 J14
    Date: 2015–09
  14. By: Chia-Lin Chang (Department of Applied Economics Department of Finance National Chung Hsing University Taichung, Taiwan.); Michael McAleer (Department of Quantitative Finance National Tsing Hua University, Taiwan)
    Abstract: The purpose of this Opinion article is to discuss some ideas that might lead to papers that are suitable for publication in the Journal of Health and Medical Economics. The suggestions include the affordability and sustainability of universal health care insurance, monitoring and managing costs associated with public and private health and medical care coverage, panel data models based on industrial organization and corporate finance, and health and medical investment finance.
    Keywords: Universal health care insurance; Public health and medical care coverage; Private health and medical care coverage; Industrial organization; Corporate finance; Health and medical investment finance.
    JEL: C54 I11 I13 I18
    Date: 2015–09
  15. By: ERREYGERS, Guido; KESSELS, Roselinde
    Abstract: We suggest an alternative way to construct a family of indices of socioeconomic inequality of health. Our indices belong to the broad category of linear indices. In contrast to rank-dependent indices, which are designed in terms of the ranks of the socioeconomic variable and the levels of the health variable, our indices are based on the levels of both the socioeconomic and the health variable. We also indicate how the indices can be modified in order to introduce sensitivity to inequality in the socioeconomic distribution and to inequality in the health distribution. As an empirical illustration, we make a comparative study of the relation between income and well-being in 16 European countries using data from SHARE Wave 4.
    Keywords: Inequality measurement, Socioeconomic inequality of health, Bivariate inequality
    JEL: D63 I00
    Date: 2015–08
  16. By: Maria Lacko (Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences)
    Abstract: There is considerable variation in mortality rates of the working age populations across the “old” and the “new” EU member states, and former Soviet Union countries. The explanation for these differences is investigated by scrutinizing three different groups of factors: 1. Socio-economic factors; 2. Lifestyle factors; 3. Health care resources. The analysis is based on regression analysis of health production functions (HPF) calculated from cross-country estimations for 2011. The explanatory variables of the health production function can explain 83-93% of the cross-country differences in mortality rates. The most important contribution comes from the past economic and political system represented by the historical structure of production and the present level of development. We confirmed what other authors found that the “example of Europe shows political system can significantly affect health and mortality conditions.” Economic and lifestyle disadvantages turn out to be more harmful for men than women. The effects of health expenditure, the geographical location of the country and the relative prices of alcohol and tobacco products are similar for the two genders. The consumption of spirits and tobacco, the share of the hidden economy, and the education level are significant explanatory factors for men, but non-significant for women.
    Keywords: mortality rate, cross-country comparison, East-, Central and West-Europe
    JEL: I12
    Date: 2015–07
  17. By: Bernhard Schmidpeter
    Abstract: In this paper we investigate the effect of stress on the survival probability using a child’s death as the triggering event. Employing a propensity score weighted Kaplan-Meier estimator, we are able to explore the associated time pattern of grief without imposing assumptions on the underlying duration process. We find a non-monotonic relationship between time and relative survival rates: decreasing for 13 years after the event and slowly reversing afterward. However, even 19 years after the event bereaved parents have significantly lower survival probabilities compared to the hypothetical case, that the event had not occurred. Investigating the main reason for this development, our results indicate that bereaved parents have a higher probability of dying from natural causes, especially circulatory diseases. Interestingly, our results reveal that bereavement has a stronger impact on fathers, while we find only modest evidence for mothers. This is a novel and surprising finding as males are in general regarded as more stress resilient than females. However, this research shows that this perception is not true.
    Keywords: Bereavement, Child death, Death, Adjusted Kaplan Meier
    JEL: I12 J14 C41
    Date: 2015–09
  18. By: LUYTEN, Jeroen; DESMET, Pieter; KESSELS, Roselinde; GOOS, Peter; BEUTELS, Philippe
    Abstract: Priority setting in health care involves many complex social value judgments. Whereas a wide body of empirical research has emerged that describe how people make these judgments, little is known about the psychological background against which they are made. In this study, we investigate whether the character trait of dispositional optimism, i.e. anticipating a positive or negative future, influences the way people think about priority setting in health care. We do this by linking a representative sample of the Belgian population’s (N=750) responses on the Revised Life Orientation Test to their responses to a discrete choice experiment (DCE) about priority setting. We find that more pessimistic individuals are on average in worse (self-reported) health, are younger, are more likely to smoke and are less likely to have a university degree than their more optimistic counterparts. Controlling for these respondent characteristics, we find that dispositional optimism indeed matters to priority setting. “Pessimists” are less willing to invest limited resources in prevention and are less in support of prioritizing younger generations over older ones.
    Keywords: Equity, Prevention, Allocation, Personality, Discrete choice experiment
    JEL: C25 C99 I18 I19 H4
    Date: 2015–08
  19. By: Helena Sofia Rodrigues (Business School, Polytechnic Institute of Viana do Castelo and CIDMA); Manuel Fonseca (Business School, Polytechnic Institute of Viana do Castelo and Applied Management Research Unit (UNIAG)); Paulo Ribeiro Cardoso (Faculty of Economic Sciences and Management, University Lusíada Porto and Faculty of Human and Social Sciences – University Fernando Pessoa, Porto)
    Abstract: Traffic accidents are a global phenomenon with devastating social and economic consequences. In Portugal, according to data provided by the National Road Safety Authority (ANSR, 2014) there were in 2014, 30,604 accidents with victims and 482 deaths. The communication campaigns of road safety are a tool available to fight this reality.There are studies that point the fact that men are much more involved in road accidents than women. The aim of this study was to investigate how gender differences influence the behavior and attitude of the Portuguese drivers regarding driving as well as the attitude toward the road safety campaigns. There are no studies that make this kind of differentiation in the country. To implement this purpose, firstly it was described the profile of drivers by gender regarding a set of behavioral variables. Then, keeping the gender differentiation for principle, the attitude of drivers toward the road safety communication campaigns was analyzed. It was applied a survey to 310 Portuguese drivers from both genders. It was found that female drivers have less risky behaviors, namely speeding and driving after drink. Besides, women remember better the road safety campaigns and intend to apply them in the daily journey as a safety measure.
    Keywords: Road traffic accidents; road safety campaigns; driver behavior; gender effect; target audience; Pearson Chi-Square; principal components analysis
    JEL: M31 M37 C38
  20. By: A GÜLERARSLAN (Selcuk University)
    Abstract: According to definition of World Health Organization “Health is a state of complete physical, mental and social well-being and not merely the absence of disease or infirmity”. Starting from this point in present society individuals not only purchasing products for health for any diseases which they suffer but also for sustaining their comfort and to feel themselves well. Herbal products appear as important consuming product in treatment period of diseases and also in protective health. In this study role of opinion leaders about purchasing attitude and behaviors of individuals having knowledge about herbal products somehow is questioned. Study aims to determine under which criteria attitudes occur about very important issue such as health determining the quality of life of individuals is about understanding by which references opinions occur about purchasing herbal products and influence of opinion leaders during purchasing process. Study particularly aims to present the role of opinion leaders within the context of high educated sample.
    Keywords: Health Communication, Health Consumption, Purchasing Behavior, Opinion Leaders
    JEL: E29
  21. By: Lorenzo Almada; Ian M. McCarthy; Rusty Tchernis
    Abstract: There is an increasing perception among policy makers that food stamp benefits contribute positively to adult obesity rates. We show that these results are heavily dependent on one's assumptions regarding the accuracy of reported food stamp participation. When allowing for misreporting, we find no evidence that SNAP participation significantly increases the probability of being obese or overweight among adults. Our results also highlight the inherent bias and inconsistency of common point estimates when ignoring misreporting, with treatment effects from instrumental variable methods exceeding the non-parametric upper bounds by over 200% in some cases.
    JEL: C01 H4 I1 I28
    Date: 2015–09

This nep-hea issue is ©2015 by Yong Yin. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.