nep-hea New Economics Papers
on Health Economics
Issue of 2016‒02‒17
39 papers chosen by
Yong Yin
SUNY at Buffalo

  1. The ability to pay for long-term care in the Netherlands: a life-cycle perspective By Harry ter Rele; Arjen Hussem; Casper van Ewijk; Albert Wong
  2. Parental Influences on Health and Longevity: Lessons from a Large Sample of Adoptees By Lindahl, Mikael; Lundberg, Evelina; Palme, Mårten; Simeonova, Emilia
  3. Health Information and Well-Being: Evidence from an Asymptomatic Disease By Dahlberg, Matz; Mani, Kevin; Öhman, Mattias; Wanhainen, Anders
  4. Micro and Macro Determinants of Health: Older Immigrants in Europe By Constant, Amelie F.; García-Muñoz, Teresa; Neuman, Shoshana; Neuman, Tzahi
  5. The Relationship between Maternal Pre-Pregnancy BMI and Preschool Obesity By Averett, Susan L.; Fletcher, Erin K.
  6. The Dynamic Effect of Disability on Work and Subjective Wellbeing in Australia By Jones, Melanie; Mavromaras, Kostas G.; Sloane, Peter J.; Wei, Zhang
  7. The Health Implications of Social Pensions: Evidence from China's New Rural Pension Scheme By Cheng, Lingguo; Liu, Hong; Zhang, Ye; Zhao, Zhong
  8. Making Disability Work? The Effects of Financial Incentives on Partially Disabled Workers By Koning, Pierre; van Sonsbeek, Jan-Maarten
  9. The Role of Sickness in the Evaluation of Job Search Assistance and Sanctions By van den Berg, Gerard J.; Hofmann, Barbara; Uhlendorff, Arne
  10. Religion and Depression in Adolescence By Cooley Fruehwirth, Jane; Iyer, Sriya; Zhang, Anwen
  11. Consumption Smoothing in the Demand for Health Care By Kristensen, Nicolai; Andersen, Henrik Lindegaard
  12. The Acceleration of Immigrant Unhealthy Assimilation By Giuntella, Osea; Stella, Luca
  13. Self-Reported Health and Gender: The Role of Social Norms By Caroli, Eve; Weber-Baghdiguian, Lexane
  14. Soda Taxes and the Prices of Sodas and Other Drinks: Evidence from Mexico By Grogger, Jeff
  15. The Effectiveness of Medical and Vocational Interventions for Reducing Sick Leave of Self-Employed Workers By Baert, Stijn; van der Klaauw, Bas; van Lomwel, Gijsbert
  16. Intrahousehold Bargaining, Domestic Violence and Child Health Outcomes in Ghana By Nuhu, Ahmed Salim
  17. Privately owned hospitals - 2015 By Augurzky, Boris; Pilny, Adam; Wübker, Ansgar
  18. Quality provision and reporting when health care services are multi-dimensional and quality signals imperfect By Huesmann, Katharina; Mimra, Wanda
  19. The Market for Nursing Homes in Germany: a spatial competition approach By Hange, Ulrich
  20. Missing at Work - Sickness-related Absence and Subsequent Job Mobility By Chadi, Adrian; Goerke, Laszlo
  21. Do Deductibles reduce Moral Hazard in the German Statutory Health Insurance? - Empirical Evidence By Thönnes, Stefanie
  22. Public health insurance and entry into self-employment By Fossen, Frank M.; König, Johannes
  23. Education, lifetime labor supply, and longevity improvements By Fürnkranz-Prskawetz, Alexia; Sanchez-Romero, Miguel; d'Albis, Hippolyte
  24. The Pros and Cons of Sick Pay Schemes: A Method to Test for Contagious Presenteeism and Shirking Behavior By Pichler, Stefan; Ziebarth, Nicolas R.
  25. When Labor Disputes Bring Cities to a Standstill: The Impact of Public Transit Strikes on Traffic, Accidents, Air Pollution, and Health By Hener, Timo; Rainer, Helmut; Bauernschuster, Stefan
  26. Unemployment, Sick Leave and Health By Schön, Matthias
  27. On the Effectiveness of Developmental Screenings: Evidence from a Nationwide Program in Austria By Pruckner, Gerald J.; Halla, Martin; Schober, Thomas
  28. An empirical model of health care demand under non-linear pricing By Winkelmann, Rainer
  29. Weight Loss and Sexual Activity in adult Obese Individuals: Establishing a Causal Link By Tauchmann, Harald; Reichert, Arndt Rüdiger; Wübker, Ansgar
  30. Health Consequences of Starting a Career on a Fixed-Term Contract By Auer, Wolfgang
  31. Risk Selection under Public Health Insurance with Opt-out By Panthöfer, Sebastian
  32. Sickness absence, presenteeism and work-related characteristics By Arnold, Daniel Timo; de Pinto, Marco
  33. Political conflict, child mental health, and cognitive development By Jürges, Hendrik; Schwarz, Alexandra
  34. Long-term care reform and the labor supply of household members - evidence from a quasi-experiment By Korfhage, Thorben; Geyer, Johannes
  35. Commuting and Sickness Absence By Lorenz, Olga; Goerke, Laszlo
  36. The Effects of Sickness Absence in School on Educational Achievements, Mortality and Income By Kamhöfer, Daniel A.; Cattan, Sarah; Karlsson, Martin; Nilsson, Therese
  37. Biased Survival Beliefs, Psychological and Cognitive Explanations, and the Demand for Life Insurances By Grevenbrock, Nils; Groneck, Max; Ludwig, Alexander; Zimper, Alexander
  38. Medical Screening and Award Errors in Disability Insurance By Liebert, Helge
  39. Do elderly choose nursing homes by quality, price or location? By Stroka, Magdalena; Schmitz, Hendrik

  1. By: Harry ter Rele; Arjen Hussem; Casper van Ewijk; Albert Wong
    Abstract: This paper uses synthetic life-cycle paths at the individual level to analyze the distribution of long-term care expenditures in the Netherlands. Using a comprehensive set of administrative data 20,000 synthetic life-cycle paths of household income and long-term care costs are constructed using the nearest neighbor resampling method. We show that the distribution of these costs is less skewed when measured over the life-cycle than on a cross-sectional basis. This may provide an argument for self-insurance by smoothing these costs over the life-cycle. Yet costs are concentrated at older ages, which limits the scope for self-insurance. Furthermore, the paper investigates the relation between long-term care expenditures, household composition, and income over the life-cycle. The expenditures on a lifetime basis from the age of 65 are higher for low income households, and (single) women.
    Date: 2016–01
  2. By: Lindahl, Mikael (Department of Economics, School of Business, Economics and Law, Göteborg University); Lundberg, Evelina (Uppsala University); Palme, Mårten (Stockholm University); Simeonova, Emilia (Johns Hopkins University)
    Abstract: To what extent is the length of our lives determined by pre-birth factors? And to what extent is it affected by parental resources during our upbringing that can be influenced by public policy? We study the formation of adult health and mortality using data on about 21,000 adoptees born between 1940 and 1967. The data include detailed information on both biological and adopting parents. We find that the health of the biological parents affects the health of their adopted children. Thus, we confirm that genes and conditions in utero are important intergenerational transmission channels for long-term health. However, we also find strong evidence that the educational attainment of the adopting mother has a significant impact on the health of her adoptive children, suggesting that family environment and resources in the post-birth years have long-term consequences for children’s health.
    Keywords: Health inequality; mortality; Pre- versus post-birth decomposition
    JEL: I10 I14 I24
    Date: 2016–01
  3. By: Dahlberg, Matz (Institute for Housing and Urban Research); Mani, Kevin (Department of Surgical Sciences); Öhman, Mattias (Department of Economics); Wanhainen, Anders (Department of Surgical Sciences)
    Abstract: We examine how health information affects individuals' subjective well-being using a regression discontinuity design on data from a screening program for an asymptomatic disease, abdominal aortic aneurysm (AAA). The information provided to the individuals is guided by the measured aorta size and its relation to pre-determined levels. When comparing individuals that receive information that they are healthy with those that receive information that they are in the risk zone for AAA, we find no effects. However, when comparing those that receive information that they have a small AAA, and will be under increased surveillance, with those who receive information that they are in the risk zone, we find a weak positive effect on wellbeing. This indicates that the information about increased surveillance (positive) may outweigh the information about worse health (negative).
    Keywords: Information; Health; Screening; Abdominal Aortic Aneurysm
    JEL: D80 I12 I31
    Date: 2016–01–21
  4. By: Constant, Amelie F. (Temple University); García-Muñoz, Teresa (Universidad de Granada); Neuman, Shoshana (Bar-Ilan University); Neuman, Tzahi (Hebrew University, Jerusalem)
    Abstract: We study the health determinants of immigrant men and women over the age of fifty, in Europe, and compare them to natives. We utilize the unique Survey of Health Aging and Retirement (SHARE) and augmented it with macroeconomic information on the 22 home countries and 16 host countries. Using Multilevel Analysis we can best capture the within and between countries variation and produce reliable results. We find that during the first decade after arrival, immigrants report higher levels of subjective health compared to natives and to previous cohorts of immigrants. As time since migration passes by, reported subjective health decreases; immigrants' health becomes the same as that of comparable natives or it even decreases. The level of economic development of both the origin and the host country positively affect the individual's health, but the effect of the host country is much more pronounced. It appears that positive and negative deviations (of the host from the origin country) have different impacts on individual health: an increase in a positive deviation (the country of origin is more developed compared to the host country – a 'loss' for the immigrating individual) leads to a decrease in the immigrant's subjective health, while an increase in the absolute negative deviation (a 'gain' for the immigrating person) leads to an increase in the immigrant's subjective health. These differential effects can be explained as some variant of the Loss-Aversion Theory.
    Keywords: self-assessed health status, immigration, Europe, country of origin, older population, multilevel regression
    JEL: C22 J11 J12 J14 O12 O15 O52
    Date: 2014–12
  5. By: Averett, Susan L. (Lafayette College); Fletcher, Erin K. (Harvard University)
    Abstract: The increasing prevalence of obesity during pregnancy raises concerns over the intergenerational transmission of obesity and its potential to exacerbate the current obesity epidemic. The fetal origins hypothesis posits that the intrauterine environment might have lasting effects on children's outcomes. A large literature establishes that mother's pre-pregnancy obesity is correlated with obesity in her children. However, previous research is largely based on comparing individuals across families and hence cannot control for unobservable factors associated with both maternal and child obesity. We use both within-family comparisons and an instrumental variable approach on a sample of 4435 children to identify the effect of maternal pre-pregnancy obesity on obesity in preschool-aged children. Consistent with extant research, OLS models that rely on across-family comparisons indicate a significant correlation between maternal pre-pregnancy obesity and preschool obesity. However, maternal fixed effects render those associations insignificant. Instrumenting for mother's BMI with her sisters' BMI values confirms the null result indicating that the in utero transmission of obesity is likely not driving the increase in childhood obesity.
    Keywords: preschool obesity, pre-pregnancy obesity, gestational weight gain
    JEL: I12 J13
    Date: 2015–12
  6. By: Jones, Melanie (Cardiff University); Mavromaras, Kostas G. (NILS, Flinders University); Sloane, Peter J. (Swansea University); Wei, Zhang (NILS, Flinders University)
    Abstract: Using longitudinal data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey (2001-2013) we examine the relationship between the dynamics of work-limiting disability and employment, hours of work, earnings and life satisfaction. We employ two alternative classifications of the dynamic trajectories of disability and, in doing so, are able to explicitly consider the influence of disability exit in addition to examining onset by chronicity and severity. After controlling for unobserved individual heterogeneity, we find that the positive impact of disability exit is smaller in magnitude and shorter-lived than the negative impact of onset. Further, while individuals are found to recover from a one period disability within three years, there is no sign of adaptation even after ten years for those whose disability is chronic, defined as evident for three or more years post-onset, and severe.
    Keywords: disability, employment, hours of work, earnings, life satisfaction, HILDA
    JEL: I10 J2 J31 J71
    Date: 2015–12
  7. By: Cheng, Lingguo (Shanghai University of Finance and Economics); Liu, Hong (Central University of Finance and Economics); Zhang, Ye (Nanjing University); Zhao, Zhong (Renmin University of China)
    Abstract: This paper estimates the causal effect of income on health outcomes of the elderly and investigates underlying mechanisms by exploiting an income change induced by the launch of China's New Rural Pension scheme (NRPS). Using this policy experiment, we address the endogeneity of pension income by applying a fixed-effect model with instrumental variable correction. The results reveal that pension enrollment and income from the NRPS both have had a beneficial impact on objective measures of physical health, cognitive function, and psychological well-being of the rural elderly, and also reduced mortality over a three-year horizon by 6 percentage points. Evidence further suggests that pension recipients respond to the new pension income in multiple ways: improved nutrition intake, better accessibility to health care, increased informal care, increased leisure activities, and better self-perceived relative economic situation. These in turn act as channels from pension income to health of the Chinese rural elderly.
    Keywords: pension income, health, channels, elderly, China
    JEL: H55 I12 I38 J14
    Date: 2016–01
  8. By: Koning, Pierre (Vrije Universiteit Amsterdam); van Sonsbeek, Jan-Maarten (Free University Amsterdam)
    Abstract: This study provides insight in the responsiveness of disabled workers to financial incentives, using administrative individual data from the Netherlands from 2006 to 2013. We focus on workers receiving partial DI benefits and with substantial residual work capacities that can be exploited. After the first phase of benefit entitlement, workers that do not use their residual income capacity experience a large drop in benefit income. In effect, this implies a substantial increase in incentives to resume work. With entitlement periods in the first phase of DI benefits varying across individuals, we use a difference-in-difference approach to analyze the effects on the incidence of work, the wage earnings and full work resumption of disabled workers. Based on the effect estimate on work incidence, we infer a labor elasticity rate of 0.12. Elasticity estimates are highest among younger DI recipients, as well as individuals with mental impairments. The incentive change has only a limited impact on wage earnings of partially disabled workers and no significant impact on work resumption rates.
    Keywords: disability insurance, work incentives
    JEL: C52 H53
    Date: 2016–01
  9. By: van den Berg, Gerard J. (University of Mannheim); Hofmann, Barbara (University of Mannheim); Uhlendorff, Arne (CREST)
    Abstract: Unemployment insurance agencies may combat moral hazard by punishing refusals to apply to assigned vacancies. However, the possibility to report sick creates an additional moral hazard, since during sickness spells, minimum requirements on search behavior do not apply. This reduces the ex ante threat of sanctions. We analyze the effects of vacancy referrals and sanctions on the unemployment duration and the quality of job matches, in conjunction with the possibility to report sick. We estimate multi-spell duration models with selection on unobserved characteristics. We find that a vacancy referral increases the transition rate into work and that such accepted jobs go along with lower wages. We also find a positive effect of a vacancy referral on the probability of reporting sick. This effect is smaller at high durations, which suggests that the relative attractiveness of vacancy referrals increases over the time spent in unemployment. Overall, around 9% of sickness absence during unemployment is induced by vacancy referrals.
    Keywords: unemployment insurance, wage, physician, vacancy referrals, unemployment, monitoring, moral hazard
    JEL: J64 J65 C41 C21
    Date: 2016–01
  10. By: Cooley Fruehwirth, Jane (University of North Carolina, Chapel Hill); Iyer, Sriya (University of Cambridge); Zhang, Anwen (London School of Economics)
    Abstract: The probability of being depressed increases dramatically during adolescence and is linked to a range of adverse outcomes. Many studies show a correlation between religiosity and mental health, yet the question remains whether the link is causal. The key issue is selection into religiosity. We exploit plausibly random variation in adolescents' peers to shift religiosity independently of other individual-level unobservables that might affect depression. Using a nationally representative sample of adolescents in the US, we find robust effects of religiosity on depression, that are particularly strong for the most depressed. These effects are not a result of social context. Instead, we find that religiosity buffers against stressors, possibly through improved social and psychological resources. This has implications especially for effective mental health policy.
    Keywords: mental health, religiosity, depression, Ad Health
    JEL: I10 Z12
    Date: 2016–01
  11. By: Kristensen, Nicolai (KORA - Danish Institute for Local and Regional Government Research); Andersen, Henrik Lindegaard (KORA - Danish Institute for Local and Regional Government Research)
    Abstract: We investigate how, in temporary economic hardship, agents change their consumption of health services, and how this depends on whether the service is universally free-of-charge visits to GP's or privately co-financed dental care. We find that own expenditures for dental care decrease. The decrease is mainly seen in preventive treatment, a durable good, but for the lowest income quartile there is also a substantial decrease in expenditures for curative dental care, although this is a consumption good with very low intertemporal substitution. The expenditures for GPs are unaltered. The findings indicate that consumption of health services critically depends on the existence of user charges versus universal coverage. The welfare loss associated with postponement of preventive care is considerably lower than the welfare loss related to a decrease in the use of curative dental care induced by economic hardship. The policy implication could be public support for means-tested curative dental services.
    Keywords: health care systems, consumption smoothing, social gradient
    JEL: D1 D6 H23
    Date: 2016–01
  12. By: Giuntella, Osea (University of Oxford); Stella, Luca (University of Wuppertal)
    Abstract: It is well-known that immigrants tend to be healthier than US natives and that this advantage erodes with time spent in the US. However, we know less about the heterogeneity of these trajectories among arrival cohorts. Recent studies have shown that later arrival cohorts of immigrants have lower entry wages and experience less economic assimilation. In this paper, we investigate whether similar cohort effects can be observed in the weight assimilation of immigrants in the US. Focusing on obesity, we show that more recent immigrant cohorts arrive with higher obesity rates and experience a faster "unhealthy assimilation" in terms of weight gain.
    Keywords: health assimilation, healthy immigrant effect
    JEL: J15 I10
    Date: 2016–01
  13. By: Caroli, Eve (Université Paris-Dauphine); Weber-Baghdiguian, Lexane (Université Paris-Dauphine)
    Abstract: We investigate the role of social norms in accounting for differences in self-reported health as reported by men and women. Using the European Working Conditions Survey (EWCS, 2010), we first replicate the standard result that women report worse health than men, whatever the health outcome we consider – i.e. general self-assessed health but also more specific symptoms such as skin problems, backache, muscular pain in upper and lower limbs, headache and eyestrain, stomach ache, respiratory difficulties, depression and anxiety, fatigue and insomnia. We then proxy social norms by the gender structure of the workplace environment and study how the latter affects self-reported health for men and women separately. Our findings indicate that individuals in workplaces where women are a majority tend to report worse health than individuals employed in male-dominated work environments, be they men or women. These results are robust to controlling for a large array of working condition indicators, which allows us to rule out that the poorer health status reported by individuals working in female-dominated environments could be due to worse job quality. We interpret this evidence as suggesting that social norms associated with specific gender environments play an important role in explaining differences in health-reporting behaviours across gender, at least in the workplace.
    Keywords: health, gender, social norms, job quality
    JEL: I12 I19 J16
    Date: 2016–01
  14. By: Grogger, Jeff (University of Chicago)
    Abstract: To combat a growing obesity problem, Mexico imposed a nationwide tax on drinks with added sugar, popularly referred to as a "soda tax," effective January 2014. Since the tax took effect nationwide, there is no conventional control group that can be used as a baseline to estimate how the tax affected prices. Instead, I make use of control commodities, that is, untaxed goods that are not substitutes for the taxed drinks. I analyze data from Mexico's Consumer Price Index program, using the synthetic control method and a time-series intervention analysis. I employ a placebo inference approach, akin to permutation inference, in both cases. The estimates show that soda prices rose by more than the amount of the tax. There is less evidence that the prices of potential substitutes rose, possibly indicating that consumers did not switch to those products after the tax took effect. Some simple calculations suggest that the soda price increase could lead to a two- to four-pound reduction in mean weight. This in turn amounts to roughly 1.6 to 2.7 percent of mean body mass, which compares to weight reductions that analysts have argued would have meaningful health consequences in the U.S.
    Keywords: soda taxes, overshifting, obesity
    JEL: H22 I10
    Date: 2016–01
  15. By: Baert, Stijn (Ghent University); van der Klaauw, Bas (Vrije Universiteit Amsterdam); van Lomwel, Gijsbert
    Abstract: We investigate whether interventions by (i) medical doctors and (ii) occupational specialists are effective in reducing sick leave durations among self-employed workers. To this end, we exploit unique administrative data comprising all sick leave claims by self-employed workers insured with the major Dutch private insurer between January 2009 and March 2014. We estimate a multivariate duration model dealing with non-random selection into the two intervention types by controlling for observable and unobservable claimant characteristics. We find adverse treatment effects for both interventions, which are heterogeneous by the physical toughness of the claimants' occupation.
    Keywords: sickness absenteeism, self-employment, medical interventions, dynamic treatment effects
    JEL: C41 I13 J22 R31
    Date: 2016–01
  16. By: Nuhu, Ahmed Salim
    Abstract: I explore a unique exogenous instrument to examine how the intra-familial position of women influence health outcomes of their children using micro data from Ghana Demographic and Health Survey, 2008. Using the 2 SLS-IV estimation technique, I build a model of household bargaining and child health development with perceptions of women regarding wife-beating and marital rape in the existence of domestic violence laws, in Ghana. Even though the initial OLS estimates suggest that women’s participation in decisions regarding purchases of household consumption goods help to improve child health outcomes, the IV estimates reveal that the presence of endogeneity underestimates the impact of women’s bargaining power on child health outcomes. Our Hausman test for endogeneity also confirms that health development of children is mediated through domestic violence laws, which protect women from physical and sexual abuse in the household.
    Keywords: Intrahousehold Bargaining,Domestic Violence,Child Health Investment,Child BMI
    JEL: J12 J13
    Date: 2015–12–20
  17. By: Augurzky, Boris; Pilny, Adam; Wübker, Ansgar
    Abstract: The privatisation of hospitals, i.e. a change in their type of ownership from the municipal and private non-profit type to the private profit-oriented type, has been the subject of heated debate ever since this development began back in the early 1990s. To objectivise this debate, the Fact Books "Significance of Privately Owned Hospitals' were prepared in 2009 and 2012 using data from 2006 and 2009, respectively. The aim was to provide a sound and reasoned assessment of hospital privatisation in Germany by presenting and evaluating relevant key ratios relating to the hospital market, differentiated by type of ownership. The present Fact Book, now in its third edition, has set out to update the analyses performed in 2006 and 2009 to the current data basis from 2012/13. A further aim is to address current debates relating to emergency care and the use of nurses in hospitals. Lastly, the authors wish in particular to shed light on the hospital reform slated for 2015, including both the problem of sustainable investment financing for hospitals and the subject of quality in the hospital.
    Date: 2015
  18. By: Huesmann, Katharina; Mimra, Wanda
    Abstract: We model competition for a multi-attribute service, like health care services, where consumers observe attribute quality imprecisely before deciding on a provider. High quality in one attribute is more important in terms of ex post utility. Attribute quality is stochastic, providers can shift resources in order to increase expected quality in some attributes. Consumers rationally focus on attributes depending on signal precision and beliefs about the providers' resource allocations. When signal precision is such that consumers focus weakly on the less important attribute, any Perfect Bayesian Nash Equilibrium is inefficient. Increasing signal precision can reduce welfare, as the positive effect of better provider selection is overcompensated by the negative effect that a shift in consumer focusing has on provider quality choice. We discuss the providers' incentives for information disclosure.
    JEL: L15 D83 I11
    Date: 2015
  19. By: Hange, Ulrich
    Abstract: The German nursing home industry rapidly grows due to the permanent increase of people in need of long-term care, in particular. At the same time a large share of residents in German nursing homes is in need of social assistance. In a simple spatial competition model we show that the presence of people in need of social assistance increases prices of nursing homes. Bargaining between nursing homes and long-term care insurance companies and social assistance administration can restrain this price-enhancing effect. In addition, price negotiation may help to reach a social optimal number of nursing homes. Thus, our analysis also presents a rationale in favor of negotiations in nursing home markets from a welfare point of view.
    JEL: H53 I11 I38
    Date: 2015
  20. By: Chadi, Adrian; Goerke, Laszlo
    Abstract: Economists often interpret absenteeism as an indicator of effort. Using data from the German Socio-Economic Panel (SOEP) study, this paper offers a comprehensive discussion of this view by analysing various forms of job mobility. The evidence reveals a significantly negative (positive) link between sickness-related absence and the probability of a subsequent promotion (dismissal). In line with the interpretation of absenteeism as a proxy for effort, instrumental variable analyses suggest no causal impact of absence behaviour on the likelihood of such career events when variation in illness-related absence is triggered exogenously. We observe no consistent gender differences in the link between absence and subsequent career events.
    JEL: J22 J63 M51
    Date: 2015
  21. By: Thönnes, Stefanie
    Abstract: This paper estimates the effect of participating in the optional tariff "Premium Refund", an implicit optional deductible tariff, on different measures of medical demand. Specifically, it analyzes whether participating in the tariff can reduce ex-post moral hazard. Therefore, I use panel data from a German company health insurance fund covering the years 2008 to 2012. In order to remove potential selection bias of healthy individuals selecting into the tariff, I match the group of participants with the group of nonparticipants by socioeconomic characteristics and baseline medical characteristics, amongst others. In addition, I combine matching with regression to make results more robust. I find that participating in the premium refund tariff significantly reduces the probability of visiting a general practitioner by 6 percentage points. However, the probability of visiting a doctor because of a trivial disease such as a common cold is not reduced. I conclude that there is evidence that participation in the tariff reduces medical demand. It remains unclear, though, whether this is due to a reduction in moral hazard or whether it is driven through some other channel.
    JEL: I11 I18 I13
    Date: 2015
  22. By: Fossen, Frank M.; König, Johannes
    Abstract: We estimate the impact of a differential treatment of paid employees versus self-employed workers in a public health insurance system on the entry rate into entrepreneurship. In Germany, the public health insurance system is mandatory for most paid employees, but not for the self-employed, who usually buy private health insurance. Private health insurance contributions are relatively low for the young and healthy, and until 2013 also for males, but less attractive at the other ends of these dimensions and if membership in the public health insurance system allows other family members to be covered by contribution-free family insurance. Therefore, the health insurance system can create incentives or disincentives to starting up a business depending on the family's situation and health. We estimate a discrete time hazard rate model of entrepreneurial entry based on representative household panel data for Germany, which include personal health information, and we account for non-random sample selection. We estimate that an increase in the health insurance cost differential between self-employed workers and paid employees by 100 euro per month decreases the annual probability of entry into self-employment by 0.38 percentage points, i.e. about a third of the average annual entry rate. The results show that the phenomenon of entrepreneurship lock, which an emerging literature describes for the system of employer provided health insurance in the USA, can also occur in a public health insurance system. Therefore, entrepreneurial activity should be taken into account when discussing potential health care reforms, not only in the USA and in Germany.
    JEL: L26 I13 J20
    Date: 2015
  23. By: Fürnkranz-Prskawetz, Alexia; Sanchez-Romero, Miguel; d'Albis, Hippolyte
    Abstract: This paper presents an analysis of the differential role of mortality for the optimal schooling and retirement age when the accumulation of human capital follows the so-called "Ben-Porath mechanism". We set up a life-cycle model of consumption and labor supply at the extensive margin that allows for endogenous human capital formation based on Card (2001). This paper makes two important contributions. First, we provide the conditions under which a decrease in mortality leads to a longer education period and an earlier retirement age. Second, those conditions are decomposed into a Ben-Porath mechanism and a lifetimehuman wealth effect vs. the years-to-consume effect. Finally, using Swedish data for cohorts born between 1865 and 2000, we show that our model can match the empirical evidence.
    JEL: J10 J24 J26
    Date: 2015
  24. By: Pichler, Stefan; Ziebarth, Nicolas R.
    Abstract: This paper proposes a test for the existence and the degree of contagious presenteeism and negative externalities in sickness insurance schemes. First, we theoretically decompose moral hazard into shirking and contagious presenteeism behavior. Then we derive testable conditions for reduced shirking, increased presenteeism, and the level of overall moral hazard when benefits are cut. We implement the test empirically exploiting German sick pay reforms and administrative industry-level data on certified sick leave by diagnoses. The labor supply adjustment for contagious diseases is significantly smaller than for non-contagious diseases, providing evidence for contagious presenteeism and negative externalities which arise in form of infections.
    JEL: I12 J22 J32
    Date: 2015
  25. By: Hener, Timo; Rainer, Helmut; Bauernschuster, Stefan
    Abstract: There is widespread concern that major cities and their inhabitants are highly vulnerable to transit strikes. Governments in many countries have addressed this concern by limiting the right of transit workers to strike. Whether or not this can be justified depends, in turn, on whether strikes by transit workers implicate the safety or health of urban populations and impose disproportionate costs on non-involved third parties. We use time series and cross-sectional variation in powerful registry data in order to quantify the effects of public transit strikes in five population-relevant domains: traffic volumes, travel times, accident risk, pollution emissions, and health. The context of our study are the five largest cities in Germany, allowing us to exploit 71 public transit strikes over the period from 2002 to 2011. Generalized difference-in-differences models suggest that strikes lead to a significant increase in car traffic, congestion, accident risk and air pollution. There is also evidence for a substantial increase in accident-related injuries and pollution-related health problems. The third party congestion costs of public transit strikes exceed the private costs of struck employers by at least a factor of four.
    JEL: J00 J58 K31
    Date: 2015
  26. By: Schön, Matthias
    Abstract: This paper studies the relationship between sick leave, income and unemployment. In particular, it investigates this relationship under the generous German sick leave regulation of 100\% wage replacement, i.e., in an environment where workers do not bear any direct costs from missing work due to sickness. Using information from the German Socioeconomic Panel (GSOEP) I identify three stylized facts of sick leave in Germany. First, sick days show a strong pro-cyclical pattern. Second, average use of sick days is hump-shaped over income quintiles. Third, the number of sick days is a strong predictor of becoming unemployed. Using this micro-evidence I develop a structural model that rationalizes these facts. I argue that in absence of direct costs of sick leave the fear of future unemployment is the main driving force restraining sick leave. I then use the model to do counterfactual policy analysis.
    JEL: I14 I18 J20
    Date: 2015
  27. By: Pruckner, Gerald J.; Halla, Martin; Schober, Thomas
    Abstract: Early intervention is considered as the optimal response to developmental disorders in children. However, relatively little is known about the effectiveness of the standard practice of so-called developmental screenings. We evaluate a nationwide program for preschoolers in Austria. Identification of treatment effects is based on a sharp discontinuity in the eligibility for a financial incentive to participate in this program with respect to the date of birth. Assigned children are about 14 percentage points more likely to be screened. In the short-run, screening participation leads to follow-up medical treatment. This effect is substantially larger for children from families with low socioeconomic status (SES). This suggests that the program helps to identify and treat developmental disorders in particular among low SES children. In the longer run, we find weak evidence for dampening effects on health care cost.
    JEL: I12 J13 I18
    Date: 2015
  28. By: Winkelmann, Rainer
    Abstract: In 2004, the German Social Health Insurance introduced a co-payment for the first doctor visit in a calendar quarter. I combine a structural model of health care demand and a difference-in-differences strategy to estimate the effect of that reform on the number of visits. In the model, the implied incentive to delay a first visit also affects subsequent visits, as the expected remaining time to the end of quarter is reduced. This effect has been ignored by the prior literature using standard hurdle count models. Data are from the German Socio-Economic Panel. Results show no statistically significant reduction in visits due to the reform.
    JEL: I12 C25 C31
    Date: 2015
  29. By: Tauchmann, Harald; Reichert, Arndt Rüdiger; Wübker, Ansgar
    Abstract: Obesity may not only be linked to undesirable health outcomes but also to limitations in sexual life. The present paper aims to assess whether there is a relationship between weight change and sexual activity in obese individuals. To address the endogeneity of weight loss that is likely to result in biased estimation results, the analysis is based on data from a randomized controlled trial. In this experiment financial weight-loss rewards were randomly offen and to a subgroup of participants and can be used as exogenous source of weight variation in an instrumental variables approach. Estimation results indicate that for obese males loosing weight increases both the probability for being involved in a sexual relationship. Conditional on having already lost some weight, a further reduction of obesity also increases the frequency of sexual intercourse.
    JEL: I12 J12 J13
    Date: 2015
  30. By: Auer, Wolfgang
    Abstract: I study the short- to medium-run effects on subsequent health outcomes of starting a career on a fixed-term contract. I focus on career start since I expect that temporary contracts and their inherent economic uncertainty imply a path dependence that might have spill-over effects on other domains of life. The empirical analysis is based on rich data from the German Socio-Economic Panel, which provides comprehensive information about individuals labor market history as well as health conditions. My main results are the following. (i) Women react to fixed-term employment at the beginning of their career by experiencing worse mental health in the short run. This relationship is driven by the subjective perception of stress and pressure in these jobs, fades out over time, and is strongest in the sam-ple of women with secondary education. (ii) Women s physical health is not af-fected at all. (iii) Economic uncertainty due to fixed-term employment has no fu-ture consequences for men s mental or physical health. I argue that these findings are robust to several sensitivity tests as well as to potential endogeneity threats.
    JEL: I31 I12 J41
    Date: 2015
  31. By: Panthöfer, Sebastian
    Abstract: This paper studies risk selection between public and private health insurance when some individuals can purchase private insurance by opting out of otherwise mandatory public insurance. Using a theoretical model, I show that public insurance is adversely selected when insurers and insureds are symmetrically informed about health-related risks, and that selection can be of any type (advantageous or adverse) when insureds have private information about health risks. Drawing on data from the German Socio-Economic Panel, I find that: (1) public insurance is adversely selected under the German public health insurance with opt-out scheme, (2) individuals adversely select public insurance based on self-assessed health and advantageously select public insurance based on risk aversion, and (3) there is evidence of asymmetric information.
    JEL: I13 D82 H51
    Date: 2015
  32. By: Arnold, Daniel Timo; de Pinto, Marco
    Abstract: This paper investigates how changes in work-related factors affect workers' absence and presenteeism behavior. Previous studies (implicitly) assume that there is a substitutive relationship - specifically, that a change in a work-related factor that decreases the level of absence simultaneously increases presenteeism (or vice versa). We set up a theoretical model in which work-related characteristics not only affect a worker's absence decision but also the critical level of sickness that defines presenteeism. Our model shows that non-substitutive relationships between absence and presenteeism are also conceivable. Using European cross-sectional data, we find only one substitutive and few complementary relationships, while the bulk of the work-related characteristics are related only to one of the two sickness states.
    JEL: J22 I10 M50
    Date: 2015
  33. By: Jürges, Hendrik; Schwarz, Alexandra
    Abstract: Children living in the occupied Palestinian territories are exposed to poverty as well as continued physical and psychological violence and human rights violations, leading to low levels of mental health compared to children in Western countries. We use test score and survey data on approximately 4,000 students in grades 5 to 9 in the West Bank to study the effect of poor mental health on cognitive development. We show that low cognitive test scores are significantly linked with measures of mental health such as the Birleson depression self-rating scale or the parent-rated Strengths and Difficulties (SDQ) scores also after controlling for a wide range of potential confounders. Using self-reported exposure to potentially traumatizing events related to the Israeli-Palestinian conflict as instruments for the prevalence of mental health problems, we find evidence for a causal link between mental health and cognitive development. Since our estimators identify the effect only for those whose exposure to potentially traumatizing events has impaired their mental health (non-resilient types), we find IV estimates that are substantially larger than OLS estimates. We conclude that physical and psychological violence related to political conflict harms children's mental health and thus impairs their cognitive development. Although in the long run, addressing the underlying causes of the Israeli-Palestinian conflict is preferable, the results of this study call for short-term measures to improve the mental health and thus the cognitive ability of Palestinian children, such as increased availability of psychiatric counseling in schools and communities.
    JEL: O15 J13 I15
    Date: 2015
  34. By: Korfhage, Thorben; Geyer, Johannes
    Abstract: Germany introduced a new mandatory insurance for long-term care in 1995. It replaced a system based on means-tested transfers. The new scheme made it easier for households to draw benefits and to organize informal care. We exploit this reform as a natural experiment and examine its effect on the labor supply of caregivers who live in the same household as the care recipient. We find strong negative results for male labor supply but not for women. We conduct a set of robustness tests and our results prove to be stable.
    JEL: J22 H31 I18
    Date: 2015
  35. By: Lorenz, Olga; Goerke, Laszlo
    Abstract: Commuting is an important and growing component of workers daily life and demands a lot of time. Given the importance of commuting, it is crucial to understand its consequences for different aspects of individual labour supply. In this paper, we focus on the causal effect of commuting on sickness absence from work using German panel data. According to theory, the effect of commuting on the number of workers absence days may be positive or negative. Empirical tests of this effect are not standard, due to reverse causation and lack of good control variables. To address reverse causation, estimates of commuting on absenteeism are derived using changes in commuting distance for workers who stay at the same workplace and who have the same residence during the period of observation. Keeping the workers employer and residence constant allows us to address endogeneity of commuting distance. Our results show that employees, who commute long distances (more than 50 kilometres), are absent more often than comparable employees with shorter commutes.
    JEL: I10 J22 R40
    Date: 2015
  36. By: Kamhöfer, Daniel A.; Cattan, Sarah; Karlsson, Martin; Nilsson, Therese
    Abstract: This study investigates the effect of missed instruction time in school on short-term educational performance as well as long-term retirement income and mortality. Using self-gathered Swedish register data, we are able to distinguish total days of absence within a school year and missed instructional time due to sickness. Using various fixed effects strategies and an instrumental variables approach we find that individual absence leads on average to a decrease of 4.4% of standard deviation in educational performance per school year. Our results suggest that the negative effect of sickness is mainly driven by missed instructional time. The sign of the long-run consequences of absence are in line with economic theory but the effect size is rather small.
    JEL: C23 I14 I21
    Date: 2015
  37. By: Grevenbrock, Nils; Groneck, Max; Ludwig, Alexander; Zimper, Alexander
    Abstract: This paper presents new findings on biased survival beliefs by constructing their individual-level objective counterparts. We find that biases can be modelled through age-dependent probability weighting functions as known in cumulative prospect theory. The dynamics of these probability weighting functions over age suggest that misconception is increasingly driven by pessimism and likelihood insensitivity. These findings are in line with rationalizations in the literature using structural behavioral learning models with psychological biases. Exploiting newly available data from the Health and Retirement Study (HRS) on psychological factors we provide further empirical evidence supporting these explanations. Finally, we show that misconception is relevant for the demand for life insurance.
    JEL: D12 D83 I10
    Date: 2015
  38. By: Liebert, Helge
    Abstract: This paper investigates the impact of medical screening on individual disability insurance benefit receipt. Using a unique policy change in Switzerland, I assess the size of award errors in disability insurance and show that improvements in medical screening can substantially reduce insurance inflow. In the absence of explicit medical screening, wrongful admissions dominate rejection errors and account for at least 14% of insurance inflow. Misclassification is tied to difficult-to-diagnose conditions, indicating inaccurate assessments by general practitioners. Reductions in full pension benefit awards are potentially substituted in part by increases in partial benefit awards.
    JEL: H53 H55 J14
    Date: 2015
  39. By: Stroka, Magdalena; Schmitz, Hendrik
    Abstract: Quality report cards addressing information asymmetry in the health care market have become a popular strategy used by policymakers to improve the quality of care for elderly. Using individual level data from the largest German sickness fund merged with institutional level data, we examine the relationship between nursing home quality, as measured by recently introduced report cards, nursing home prices, nursing home s location and the individual choice of nursing homes. Report cards were stepwise introduced as of 2009 and we use a sample of 2010 that includes both homes that had been evaluated at that time and that had not yet been. Thus, we can distinguish between institutions with good and bad ratings as well as non-rated nursing homes. We find that the probability of choosing a nursing home decreases in distance and price. However, we find no significant effect of reported quality on individuals choice of nursing homes.
    JEL: I10 I11 I19
    Date: 2015

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