nep-hea New Economics Papers
on Health Economics
Issue of 2017‒07‒02
23 papers chosen by
Yong Yin
SUNY at Buffalo

  1. Management Practices and the Quality of Primary Care By Angelis, Jannis; Häger Glenngård, Anna; Jordahl, Henrik
  2. Does the Equivalence Scale Matter? Equivalence and Out-of-Pocket Payments By Steven F. Koch
  3. Insight into the Female Longevity Puzzle: Using Register Data to Analyse Mortality and Cause of Death Behaviour Across Socio-economic Groups By Malene Kallestrup-Lamb; Carsten P.T. Rosenskjold
  4. Subsidized antimalarial drugs in Dakar (Senegal): Do the poor benefit? By Georges Karna KONE; Martine AUDIBERT; Richard LALOU; Hervé LAFARGE; Jean-Yves LE HESRAN
  5. Toward an Assessment of the U.S. Small Business Innovation Research (SBIR) Program at the National Institutes of Health By Link, Albert; Scott, John
  6. An Evaluation of the Proposed Worker Protection Standard with Respect to Pesticide Exposure, and Parkinson’s Disease By Alica Stubnova Sparling; David W. Martin; Lillian B. Posey
  7. Terminal Decline in Well-Being: The Role of Multi-Indicator Constellations of Physical Health and Psychosocial Correlates By Andreas M. Brandmaier; Nilam Ram; Gert G. Wagner; Denis Gerstorf
  8. Health Effects of Instruction Intensity: Evidence from a Natural Experiment in German High-Schools By Johanna Sophie Quis; Simon Reif
  9. Working Paper 267 - Does Access to Basic Services Matter for Child Health? Evidence From Togo By AfDB AfDB
  10. Firewood, smoke and respiratory diseases in developing countries: The neglected role of outdoor cooking By Langbein, Jörg
  11. Medical Malpractice: How legal liability affects medical decisions By Bertoli, P.; Grembi, V.;
  12. Primary Care Access and Emergency Department Utilization: Theory and Evidence from Canada By Nirav Mehta; Koffi Ahoto Kpelitse; Rose Anne Devlin; Lihua Li; Sisira Sarma
  13. Private and Public Health Investment Decisions By Atolia, Manoj; Papageorgiou, Chris; Turnovsky, Stephen
  14. The Value of Socialized Medicine: The Impact of Universal Primary Healthcare Provision on Mortality Rates in Turkey By Resul Cesur; Pinar Mine Gunes; Erdal Tekin; Aydogan Ulker
  15. Does Public Health Insurance Affect How Much People Work? By Gal Wettstein
  16. Estimating life expectancy free of dependency : group characterization through the proximity to the deepest dependency path By Grane Chávez, Aurea; Alonso González, Pablo J.; Albarrán Lozano, Irene
  17. Psychiatric Versus Physical Disabilities: A Comparison of Barriers and Facilitators to Employment By Purvi Sevak; Shamima Khan
  18. Does time preference affect smoking behavior? A dynamic panel analysis By Takahiro Miura
  19. Mandatory Access Prescription Drug Monitoring Programs and Prescription Drug Abuse By Dhaval M. Dave; Anca M. Grecu; Henry Saffer
  20. The Role of Hospital and Market Characteristics in Invasive Cardiac Service Diffusion By Jill R. Horwitz; Charleen Hsuan; Austin Nichols
  21. The simple economics of screening programs: an application of decision analysis to medical screening By Gottinger, Hans Werner
  22. Convergence in National Alcohol Consumption Patterns: New Global Indicators By Anderson, Kym; Holmes, Alexander
  23. The Impact of Alcohol on Mental Health, Physical Fitness, and Job Performance By Marigee Bacolod; Jesse M. Cunha; Yu-Chu Shen

  1. By: Angelis, Jannis (Research Institute of Industrial Economics (IFN)); Häger Glenngård, Anna (Research Institute of Industrial Economics (IFN)); Jordahl, Henrik (Research Institute of Industrial Economics (IFN))
    Abstract: Using the World Management Survey method, we map and analyse management quality in Swedish primary care centres. On average, private providers have higher management quality than public ones. We also find that centres with a high overall social deprivation among enrolled patients tend to have higher management quality. Regarding quality of care, we find that management quality is positively associated with accessibility, but not with patient reported experience.
    Keywords: Management quality; Primary care; Quality of care; Accessibility; World Management Survey
    JEL: H42 I11 L23 L33
    Date: 2017–06–21
  2. By: Steven F. Koch
    Abstract: We evaluate the effects of different equivalence scale parameter estimates on the distribution of catastrophic health payments in South Africa. Our analysis makes use of Xu et al.'s (2003) initial estimate, which underscores the World Health Organization's methodology (Xu, 2005). We also update it using more recent data for one of the original countries included in Xu et al. (2003), South Africa. South Africa is considered, because the data used in Xu et al. (2003) was collected before the end of Apartheid, and the end of Aparthied has led to extensive social and economic changes, which could have influenced equivalence. We extend the empirical exercise by estimating a base-independent equivalence scale via semiparametric methods. Using these equivalence scales, we examine their effect on the distribution of catastrophic health payments using thresholds of 5%, 10% and 15%. The revised estimates suggest that the initial equivalence estimates were overstated by as much as 35%, such that poverty lines in the country were understated by as as much as 17%. However, despite these large differences, the distribution of catastrophic health expenditures were unaffected.
    Keywords: Catastrophic Health Payments, Equivalence Scales, Semiparametric Estimation
    Date: 2017–06
  3. By: Malene Kallestrup-Lamb (Aarhus University and CREATES); Carsten P.T. Rosenskjold (Aarhus University and CREATES)
    Abstract: This paper analyses the complexity of female longevity improvements. As socio-economic status influence health and mortality, we partition all individuals, at each age and year, into ten socio-economic groups based on an affluence measure. We identify the particular socio-economic groups that have been driving the standstill for Danish women and within each socio-economic group we further analyse the cause of death pattern. Further, we compare the forecast performance of the Lee-Carter model with the multi-population Li and Lee model. The decline in life expectancy for Danish women is present for all subgroups, however with particular large decreases for the low-middle and middle affluence groups. We find that causes of deaths related to smoking partly contribute to the slowdown in female longevity. However the lack of improvements in deaths relating to ischemic heart diseases is dominant in explaining the slowdown and the following catch up effect in life expectancies.
    Keywords: Mortality, Affluence Groups, Social Inequality, Cause of Death, Health, Multi-population Modelling
    JEL: J11 C53 G22
    Date: 2017–02–09
  4. By: Georges Karna KONE; Martine AUDIBERT (Centre d'Etudes et de Recherches sur le Développement International(CERDI)); Richard LALOU; Hervé LAFARGE; Jean-Yves LE HESRAN
    Abstract: Senegal opted for an antimalarial drug policy (artemisinin-based combination therapy) of partial and then full exemption from health care costs for the whole population respectively in 2008 and 2010. Has this policy reduced access inequalities in children’s health care between rich and poor households? Data were collected in Dakar between 2008 and 2009 as part of a research program on urban malaria. A survey was conducted among the population of the Dakar metropolitan area. The sample was based on a two-stage sampling. The three questionnaires used for the survey were based on validated data collection tools. Indicators were built to characterize individuals, households and neighborhoods. Bivariate analysis (chi2 test) revealed social gradients within the Dakar agglomeration and characterized health care behaviors of the poorest and richest households. Data have therefore been adjusted by a double zero-inflated Poisson model. Results show that the policy of subsidizing antimalarial drugs in Senegal has reduced health care costs, including for the poor, but without improving its distributive equity. In contrast, this policy has benefited more the richest than the poorest, without mitigating social and financial inequalities. In light of the lessons learnt by the subsidy policy for antimalarial drugs, our study recommends that universal health coverage, currently implemented in Senegal, should seek to mitigate economic inequalities in access to health care for the poorest as well as to improve the health outcomes for the whole population.
    Keywords: Poverty, Universal health coverage, Health financing, Urban area, Dakar.
    JEL: I18 I14
    Date: 2017–06
  5. By: Link, Albert (University of North Carolina at Greensboro, Department of Economics); Scott, John (Dartmouth College)
    Abstract: The Small Business Innovation Development Act of 1982, which established the Small Business Innovation Research (SBIR) program, is arguably the hallmark policy initiative in the United States to support technology development and commercialization in small firms. While scholars have studied this program in detail, there has yet to be a systematic assessment of how well it is meeting its legislated goals of stimulating technological innovation and increasing private sector commercialization. We use a unique set of data on projects funded by the National Institutes of Health (NIH) SBIR program to assess the extent to which these program goals are being met. We find that, relative to a counterfactual control group, NIH can be characterized as supporting, on average, the development of high commercialization risk technologies, and we suggest that this finding aligns with the goals of the SBIR program and may in fact be for the common weal.
    Keywords: SBIR program; technology; innovation; commercial risk
    JEL: O31 O38
    Date: 2017–06–05
  6. By: Alica Stubnova Sparling (Department of Economics, Davidson College); David W. Martin (Department of Economics, Davidson College); Lillian B. Posey (Urban Institute)
    Abstract: Citing a lack of information, the U.S. Environmental Protection Agency prudently did not account for the benefits of averting many chronic diseases in analyzing the Worker Protection Standards (WPS) revisions. We demonstrate that sufficient information can exist, using the example of the benefits to agricultural workers of reduced Parkinson’s disease (PD) due to reduced pesticide exposure. We define the benefits as the monetary value gained by improving quality of lives of people who would otherwise develop PD, plus the value of medical care cost averted and income not lost due to being healthy. For estimation, we use readily available parameters and obtain odds ratios of developing PD by conducting a meta-analysis of studies linking pesticide exposure to PD. The sensitivity analysis varies the number of agricultural workers affected by the regulation, the probability of being diagnosed with PD, the measurement and the timing of the benefits. Our initial assessment is that the reduced PD benefits would be a small fraction of the total WPS revision costs. However, if we define benefits as the common environmental economics willingness to pay to avoid PD incidence, then they become a substantial fraction of the costs. Our analysis demonstrates that the benefits of averting PD from the WPS revisions can be estimated using existing information, and that the results are most sensitive to the choice of valuation of benefits to the worker. We encourage other researchers to extend our framework to other chronic ailments. Publication Status: Published in International Journal of Environmental Research and Public Health, 2017, 14(6):640.
    Keywords: Worker Protection Standards, Pesticide Exposure, Parkinson’s Disease
    JEL: I18
    Date: 2017–02
  7. By: Andreas M. Brandmaier; Nilam Ram; Gert G. Wagner; Denis Gerstorf
    Abstract: Well-being is often relatively stable across adulthood and old age, but typically exhibits pronounced deteriorations and vast individual differences in the terminal phase of life. However, the factors contributing to these differences are not well understood. Using up to 25-year annual longitudinal data obtained from 4,404 now-deceased participants of the nationwide German Socio-Economic Panel Study (SOEP; age at death: M = 73.2 years; SD = 14.3 years; 52% women), we explored the role of multi-indicator constellations of socio-demographic variables, physical health and burden factors, and psychosocial characteristics. Expanding earlier reports, Structural Equation Model Trees (SEM Trees) allowed us to identify profiles of variables that were associated with differences in the shape of late-life well-being trajectories. Physical health factors were found to play a major role for well-being decline, but in interaction with psychosocial characteristics such as social participation. To illustrate, for people with low social participation, disability emerged as the strongest correlate of differences in late-life well-being trajectories. However, for people with high social participation, whether or not an individual had spent considerable time in the hospital differentiated high vs. low and stable vs. declining late-life well-being. We corroborated these results with Variable Importance measures derived from a set of resampled SEM Trees (so-called SEM forests) that provide robust and comparative indicators of the total interactive effects of variables for differential late-life well-being. We discuss benefits and limitations of our approach and consider our findings in the context of other reports about protective factors against terminal decline in well-being.
    Keywords: Successful aging; life satisfaction; SEM forest; SEM tree; German Socio-Economic Panel Study
    Date: 2017
  8. By: Johanna Sophie Quis; Simon Reif
    Abstract: A large literature aims to establish a causal link between education and health using changes in compulsory schooling laws. It is however unclear how well more education is operationalized by marginal increases in school years. We shed a new light on this discussion by analyzing the health effects of a reform in Germany where total years of schooling for students in the academic track were reduced from nine to eight while keeping cumulative teaching hours constant by increasing instruction intensity. The sequential introduction of the reform allows us to implement a triple difference-in-differences estimation strategy with data from the German Socio-Economic Panel. We find that increased weekly instruction time has negative health effects for females while they are still in school. However, after graduation, females even seem to benefit from reduced school years. We find no effects on males’ health.
    Keywords: education and health; instruction intensity; natural experiment; SOEP
    JEL: I19 I21 I28
    Date: 2017
  9. By: AfDB AfDB
    Date: 2017–06–19
  10. By: Langbein, Jörg
    Abstract: Smoke from cooking in the kitchen is one of the world's leading causes of premature child death, claiming the lives of 500,000 children under five annually. This study analyses the role of outdoor cooking and the prevalence of respiratory diseases among children under five years by means of probit regressions using information from 41 surveys conducted in 30 developing countries from Asia, Africa and Latin America. I find that outdoor cooking reduces respiratory diseases among young children aged 0-4 by around 9 percent, an effect that reaches 13 percent among children aged 0-1. The results suggest that simple behavioral interventions, such as promoting outdoor cooking, can have a substantial impact on health hazards.
    Keywords: air pollution,health behavior,energy access
    JEL: Q53 I12 O13
    Date: 2017
  11. By: Bertoli, P.; Grembi, V.;
    Abstract: In health care, overuse and underuse of medical treatments represent equally dangerous deviations from an optimal use equilibrium and arouses concerns about possible implications for patients' health, and for the healthcare system in terms of both costs and access to medical care. Medical liability plays a dominant role among the elements that can affect these deviations. Therefore, a remarkable economic literature studies how medical decisions are influenced by different levels of liability. In particular, identifying the relation between liability and treatments selection, as well as disentangling the effect of liability from other incentives that might be in place, is a task for sound empirical research. Several studies have already tried to tackle this issue, but much more needs to be done. In the present chapter, we offer an overview of the state of the art in the study of the relation between liability and treatments selection. First, we reason on the theoretical mechanisms underpinning the relationship under investigation by presenting the main empirical predictions of the related literature. Second, we provide a comprehensive summary of the existing empirical evidence and its main weaknesses. Finally, we conclude by offering guidelines for further research.
    Keywords: Medical Malpractice; Medial Liability; Treatment Selection; Defensive Medicine; Empirical Analysis; General Review;
    Date: 2017–06
  12. By: Nirav Mehta; Koffi Ahoto Kpelitse; Rose Anne Devlin; Lihua Li; Sisira Sarma
    Abstract: We develop a theoretical model to study how after-hours incentives affect emergency department (ED) utilization via changing physician behavior. The model reveals that reductions in ED utilization can only come from patients with conditions severe enough to warrant visiting the ED, yet mild enough to be treatable by their primary care physician. While these incentives induce physicians to work more after hours, they also reduce regular-hours services. Thus, incentivizing physicians to provide after-hours services ambiguously affects ED utilization. Model predictions are tested using administrative data from the province of Ontario, Canada. The data cover visits to physicians’ offices and ED visits from 2004 to 2013, a period with exogenous changes in after-hours incentives. Our findings are consistent with model predictions. We also find that after-hours incentives reduce ED visits, suggesting that our proposed framework may be useful for understanding and even designing after-hours incentives.
    Date: 2017–06
  13. By: Atolia, Manoj; Papageorgiou, Chris; Turnovsky, Stephen
    Abstract: In recent years, there has been an explosive increase in the demand for health products and services by people all around the globe, and particularly in advanced economies. Aiming to enhance longevity but also improve quality of life, individual consumption of pharmaceutical products and services has risen exponentially since the early 1980s. This paper develops a model in which agents invest part of their resources in medical products and time in physical exercise to enhance their health status. In the first part of the paper, we study the steady state and transitional dynamics of the model with special emphasis on the effects of health decisions on aggregate outcomes. In the second part, we explore how public health policies may alter private economic decisions that promote healthier and more productive lives.
    Keywords: Private and public health investments; endogenous discounting of the rate of time preference; neoclassical growth model; health policy.
    JEL: O16 O24 O38 O43
    Date: 2017–06
  14. By: Resul Cesur; Pinar Mine Gunes; Erdal Tekin; Aydogan Ulker
    Abstract: This paper examines the impact of universal, free, and easily accessible primary healthcare on population health as measured by age-specific mortality rates, focusing on a nationwide socialized medicine program implemented in Turkey. The Family Medicine Program (FMP), launched in 2005, assigns each Turkish citizen to a specific state-employed family physician who offers a wide range of primary healthcare services that are free-of-charge. Furthermore, these services are provided at family health centers, which operate on a walk-in basis and are located within the neighborhoods in close proximity to the patients. To identify the causal impact of the FMP, we exploit the variation in its introduction across provinces and over time. Our estimates indicate that the FMP caused the mortality rate to decrease by 25.6% among infants, 7.7% among the elderly, and 22.9% among children ages 1-4. These estimates translate into 2.6, 1.29, and 0.13 fewer deaths among infants, the elderly, and children ages 1-4, respectively. Furthermore, the effects appear to strengthen over time. We also show evidence to suggest that the FMP has contributed to an equalization of mortality across provinces. Finally, our calculations indicate that each family physician saves about 0.15, 0.46, and 0.005 lives among infants, the elderly, and children ages 1-4 per province every year.
    Date: 2017–06
  15. By: Gal Wettstein
    Abstract: Most Americans get their health insurance through their employer, so they may be reluctant to leave a job if such a change affects their coverage. This situation is known as “job lock,” which may be a particular concern for those with health problems. As a result, expansions of public health insurance, which are not tied to a job, could reduce job lock and result in some workers scaling back from full- to part-time work or leaving the labor force entirely. One way to estimate the effect of public health insurance on job lock is to look at policy changes that offer a “natural experiment." This brief, based on a recent paper, uses the introduction of Medicare Part D in 2006 to assess the extent to which the availability of drug coverage not tied to an employer induces older individuals to work less. The discussion proceeds as follows. The first section provides brief background on Medicare Part D. The second section describes the data and sets up the methodology. The third section shows trends in labor force activity among the elderly before and after 2006. The fourth section summarizes the main results. The final section concludes that, prior to the introduction of Part D, “job lock” was a significant concern for individuals who would otherwise have lost their employer drug insurance at age 65. While this group was a relatively modest portion of the total population of older Americans, this result does suggest that having the option of public health insurance can reduce a barrier to labor force transitions.
    Date: 2017–06
  16. By: Grane Chávez, Aurea; Alonso González, Pablo J.; Albarrán Lozano, Irene
    Abstract: The aging of population is perhaps the most important problem that developed countries must face in the near future. Dependency can be seen as a consequence of the process of gradual aging. In a health context, this contingency is defined as a lack of autonomy in performing basic activities of daily living that requires the care of another person or significant help. In Europe in general and in Spain in particular this phenomena represents a problem with economic, political, social and demographic implications. The prevalence of dependency in the population, as well as its intensity and its evolution over the course of a person's life are issues of greatest importance that should be addressed. The aim of this work is to estimate life expectancy free of dependency (LEFD) using categorical data and individual dependency trajectories that are obtained using the whole medical history concerning the dependency situation of each individual from birth up to 2008, contained in database EDAD 2008. In particular, we estimate LEFD in several scenarios attending to gender, proximity-group and dependency degree. Proximity-groups are established according to an L2-type distance from the dependency trajectories to a central trend within each age-gender group, using functional data techniques. The main findings are: First, the estimated LEFD curves reach higher values for women than for men; Second, their decreasing rate is higher (and more abrupt) for men than for women; Third, the more the dependency trajectories depart from the central trend, the more the gap between the LEFD for major dependency and the other dependency situations widens; Finally, we show evidence that to estimate LEFD ignoring the partition by proximity-groups may lead to nonrepresentative LEFD estimates.
    Keywords: Functional Data; Disability; Dependency; Cox Regression; ADL
    Date: 2017–06
  17. By: Purvi Sevak; Shamima Khan
    Abstract: This study aims to better identify barriers to and facilitators of employment for individuals with psychiatric disabilities and how these factors may differ for individuals with physical disabilities.
    Keywords: employment, psychiatric disabilities
    JEL: I J
  18. By: Takahiro Miura (Graduate School of Economics, Osaka University)
    Abstract: I analyze the effect of time preference on smoking behavior while controlling for the effect of past smoking behavior, using a dynamic panel analysis. I use nationwide micro panel data from Japan and make three main findings. First, as in the previous literature, without controlling for the effect of past smoking behavior, I find positive associations between time preference and smoking behavior, with the association significant for male. Second, by using a dynamic panel analysis, I find that time preference affects smoking behavior significantly for female but not for male. Third, male smokers who have a low discount rate are more likely to want to quit or reduce smoking behavior, whereas female smokers with a low discount rate are no more likely to want to quit or reduce smoking behavior. This result implies that while male smokers are concerned about the future consequences of smoking, they cannot manage to quit.
    Keywords: Time preference, Smoking, Dynamic panel analysis, State dependence
    JEL: D90 I12
    Date: 2016–05
  19. By: Dhaval M. Dave; Anca M. Grecu; Henry Saffer
    Abstract: Despite the significant cost of prescription (Rx) drug abuse and calls from policy makers for effective interventions, there is limited research on the effects of policies intended to limit such abuse. This study estimates the effects of prescription drug monitoring (PDMP) programs which is a key policy targeting the non-medical use of Rx drugs. Based on objective indicators of abuse as measured by substance abuse treatment admissions related to Rx drugs, estimates do not suggest any substantial effects of instituting an operational PDMP. We find, however, that mandatory-access provisions, which raised PDMP utilization rates by actually requiring providers to query the PDMP prior to prescribing a controlled drug, are significantly associated with a reduction in Rx drug abuse. The effects are driven primarily by a reduction in opioid abuse, generally strongest among young adults (ages 18-24), and underscore important dynamics in the policy response. Robustness checks are consistent with a causal interpretation of these effects. We also assess potential spillovers of mandatory PDMPs on the use of other illicit drugs, and find a complementary reduction in admissions related to cocaine and marijuana abuse.
    JEL: H0 I1 K0
    Date: 2017–06
  20. By: Jill R. Horwitz; Charleen Hsuan; Austin Nichols
    Abstract: Little is known about how the adoption and diffusion of medical innovation is related to and influenced by market characteristics such as competition. The particular complications involved in investigating these relationships in the health care sector may explain the dearth of research. We examine diagnostic angiography, percutaneous coronary interventions (PCI), and coronary artery bypass grafting (CABG), three invasive cardiac services. We document the relationship between the adoption by hospitals of these three invasive cardiac services and the characteristics of hospitals, their markets, and the interactions among them, from 1996-2014. The results show that the probability of hospitals adopting a new cardiac service depends on competition in two distinct ways: 1) hospitals are substantially more likely to adopt an invasive cardiac service if competitor hospitals also adopt new services; 2) hospitals are less likely to adopt a new service if a larger fraction of the nearby population already has geographic access to the service at a nearby hospital. The first effect is stronger, leading to the net effect of hospitals duplicating access rather than expanding access to care. In addition, for-profit hospitals are considerably more likely to adopt these cardiac services than either nonprofit or government-owned hospitals. Nonprofit hospitals in high for-profit markets are also more likely to adopt them relative to other nonprofits. These results suggest that factors other than medical need, such as a medical arms race, partially explain technological adoption.
    JEL: I1 I11 I18 L1 L13 L2 L3 L8
    Date: 2017–06
  21. By: Gottinger, Hans Werner (Center for Mathematical Economics, Bielefeld University)
    Date: 2017–04–04
  22. By: Anderson, Kym; Holmes, Alexander
    Abstract: With increasing globalisation and interactions between cultures, countries are converging in many ways, including in their consumption patterns. The extent to which this has been the case in alcohol consumption has been the subject of previous studies, but those studies have been limited in scope to a specific region or group of high-income countries or to just one or two types of alcohol. The present study updates earlier findings, covers all countries of the world since 1961, introduces two new summary indicators to capture additional dimensions of the extent of convergence in total alcohol consumption and in its mix of beverages, and distinguishes countries according to whether their alcoholic focus was on wine, beer or spirits in the early 1960s as well as to their geographic region and their real per capita income. Also, for recent years we add expenditure data and compare alcohol with soft drink retail expenditure, and we show what difference it makes when unrecorded alcohol volumes are included as part of total alcohol consumption. The final section summarizes the findings and suggests further research could provide new demand elasticity estimates and use econometrics to explain the varying extents of convergence over time, space and beverage type.
    Keywords: Alcohol consumption mix similarity index; Beverage consumption intensity index; Globalization of preferences; National beverage consumption mix
    JEL: D12 L66 N10
    Date: 2017–06
  23. By: Marigee Bacolod; Jesse M. Cunha; Yu-Chu Shen
    Abstract: We study the impact of legal access to alcohol on a range of behavioral and physical outcomes of U.S. Army soldiers in a regression discontinuity design. The wealth of novel data collected by the military on cognitive ability, psychological health, and family history allows us to explore how impacts vary with risk factors for alcohol consumption. Overall, we observe a large and significant increase in drinking after the 21st birthday, but the increases are largest amongst those who were depressed, had a family history of mental health problems, had better coping ability, and had higher cognitive ability. Despite the large increase in consumption, we do not find any meaningful impacts of legal access to alcohol - overall or in any sub-group - on any of the short-term outcomes we observe, including suicidal tendencies, depression, tobacco use, physical fitness, psychological health, deployability, smoking, and job-related infractions. Acknowledging the limitations for extrapolation out of sample, we discuss the policy implications of our results.
    JEL: I1 I12
    Date: 2017–06

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