nep-hea New Economics Papers
on Health Economics
Issue of 2018‒08‒20
thirty-one papers chosen by
Nicolas R. Ziebarth
Cornell University

  1. Disease Control and Inequality Reduction: Evidence from a Tuberculosis Testing and Vaccination Program By Butikofer, Aline; Salvanes, Kjell G
  2. Childhood Health Shocks, Comparative Advantage, and Long-Term Outcomes: Evidence from the Last Danish Polio Epidemic By Gensowski, Miriam; Nielsen, Torben Heien; Nielsen, Nete Munk; Rossin-Slater, Maya; Wüst, Miriam
  3. Does Diversity Matter for Health? Experimental Evidence from Oakland By Marcella Alsan; Owen Garrick; Grant C. Graziani
  4. Defensive Medicine: Evidence from Military Immunity By Michael D. Frakes; Jonathan Gruber
  5. Labor Market and Distributional Effects of an Increase in the Retirement Age By Geyer, Johannes; Haan, Peter; Hammerschmid, Anna; Peters, Michael
  6. Does When You Die Depend on Where You Live? Evidence from Hurricane Katrina By Tatyana Deryugina; David Molitor
  7. U.S. Safety Net Programs and Early Life Skills Formation: Results from a Prospective Longitudinal Cohort Study By Corneliu Bolbocean; Frances A. Tylavsky; James E. West
  8. Sample-Selection Bias and Height Trends in the Nineteenth-Century United States By Ariell Zimran
  9. Financial Incentives and Earnings of Disability Insurance Recipients: Evidence from a Notch Design By Philippe Ruh; Stefan Staubli
  10. Time Trends Matter: The Case of Medical Cannabis Laws and Opioid Overdose Mortality By Pohl, R. Vincent
  11. The Value of Health Insurance: A Household Job Search Approach By Gabriella Conti; Rita Ginja; Renata Narita
  12. The Welfare Implications of Health Insurance By Anup Malani; Sonia P. Jaffe
  13. Estimating Asymmetric Information Effects in Health Care Accounting for the Transactions Costs By Zheng, Yan; Vukina, Tomislav; Zheng, Xiaoyong
  14. Infant Health Care and Long-Term By Butikofer, Aline; Loken, Katrine; Salvanes, Kjell G
  15. The impact of mental problems on mortality and how it is moderated by education By Bijwaard, G.E.;; Tynelius, P.;
  16. The Evolution of Health over the Life Cycle By Roozbeh Hosseini; Kai Zhao; Karen Kopecky
  17. Effects of Access to Legal Same-Sex Marriage on Marriage and Health: Evidence from BRFSS By Christopher Carpenter; Samuel T. Eppink; Gilbert Gonzales Jr.; Tara McKay
  18. Doing Good, Feeling Good: Causal Evidence from Canadian Volunteers By Catherine Deri Armstrong; Rose Anne Devlin; Forough Seifi
  19. A Model of Addiction and Social Interactions By Julian Reif
  20. How Important Is Health Inequality for Lifetime Earnings Inequality? By Roozbeh Hosseini; Kai Zhao; Karen Kopecky
  21. The determinants of health care expenditure growth By Nigel Rice; Maria Jose Aragon
  22. Modelling Heterogeneity in the Resilience to Major Socioeconomic Life Events By Fabrice Etilé; Paul Frijters; David W. Johson; Michael A. Shields
  23. The Morbidity Cost of Air Pollution: Evidence from Consumer Spending in China By Panle Jia Barwick; Shanjun Li; Deyu Rao; Nahim Bin Zahur
  24. Long-Run Impacts of Increasing Tobacco Taxes By Alan Fuchs; Giselle Del Carmen; Alfred Kechia Mukon
  25. Estimating the Demand for Domestic and Imported Cigarettes in Rwanda By Tingum, Ernest Ngeh; Parrott, Steve
  26. Life satisfaction and diet in transition: Evidence from the Russian Longitudinal Monitoring Survey By Sonya K Huffman, Iowa State University,; Marian Rizov, University of Lincoln,
  27. Air Pollution and Mental Health: Evidence from China By Shuai Chen; Paulina Oliva; Peng Zhang
  28. The effects of self-assessed health: Dealing with and understanding misclassification bias By Cheny, L.;; Clarke, P.M.;; Petrie, D.J.;; Staub, K.E.;
  29. Measurement Error in Discrete Health Facility Choice Models:an Example from Urban Senegal By Cronin, C.J.;; Guilkey, D.K.;; Speizer, I.S.;
  30. Regional Prevalence of Health Worker Absenteeism in Tanzania By FUJII, Tomoki
  31. Malaria Control and Infant Mortality in Africa By Denis Cogneau; Pauline Rossi

  1. By: Butikofer, Aline; Salvanes, Kjell G
    Abstract: This paper examines the economic impact of a tuberculosis control program launched in Norway in 1948. In the 1940s, Norway had one of the highest tuberculosis infection rates in Europe, affecting about 85 percent of the inhabitants. To lower the disease burden, the Norwegian government launched a large-scale tuberculosis testing and vaccination campaign that substantially reduced tuberculosis infection rates among children. We find that cohorts in school during and after the campaign in municipalities with high tuberculosis prevalence gained more in terms of education, earnings, longevity, and height following this public health intervention. Furthermore, the gains from the disease control program are not limited to the initially treated cohorts but also affect their children. The results also suggest that individuals from a low socioeconomic background benefited more from the intervention and we present new evidence that a narrowing of the gap in childhood health can lead to a reduction in socioeconomic inequalities in adulthood.
    Keywords: education; Health programs; inequality; Tuberculosis
    JEL: I14 I18 I24
    Date: 2018–07
  2. By: Gensowski, Miriam (University of Copenhagen); Nielsen, Torben Heien (University of Copenhagen); Nielsen, Nete Munk (Statens Serum Institut); Rossin-Slater, Maya (Stanford University); Wüst, Miriam (Danish National Centre for Social Research (SFI))
    Abstract: A large literature documents that childhood health shocks have lasting negative consequences for adult outcomes. This paper demonstrates that the adversity of childhood physical disability can be mediated by individuals' educational and occupational choices, which reflect their comparative advantage. We merge records on children hospitalized with poliomyelitis during the 1952 Danish epidemic to census and administrative data, and exploit quasi-random variation in paralysis incidence. While childhood disability increases the likelihood of early retirement and disability pension receipt at age 50, paralytic polio survivors obtain higher education and are more likely to work in white-collar and computer-demanding jobs than their non-paralytic counterparts.
    Keywords: childhood health shocks, occupational sorting, comparative advantage, long-term effects
    JEL: I14 J24 I24 I10
    Date: 2018–06
  3. By: Marcella Alsan; Owen Garrick; Grant C. Graziani
    Abstract: We study the effect of diversity in the physician workforce on the demand for preventive care among African-American men. Black men have the lowest life expectancy of any major demographic group in the U.S., and much of the disadvantage is due to chronic diseases which are amenable to primary and secondary prevention. In a field experiment in Oakland, California, we randomize black men to black or non-black male medical doctors and to incentives for one of the five offered preventives — the flu vaccine. We use a two-stage design, measuring decisions about cardiovascular screening and the flu vaccine before (ex ante) and after (ex post) meeting their assigned doctor. Black men select a similar number of preventives in the ex-ante stage, but are much more likely to select every preventive service, particularly invasive services, once meeting with a doctor who is the same race. The effects are most pronounced for men who mistrust the medical system and for those who experienced greater hassle costs associated with their visit. Subjects are more likely to talk with a black doctor about their health problems and black doctors are more likely to write additional notes about the subjects. The results are most consistent with better patient-doctor communication during the encounter rather than differential quality of doctors or discrimination. Our findings suggest black doctors could help reduce cardiovascular mortality by 16 deaths per 100,000 per year — leading to a 19% reduction in the black-white male gap in cardiovascular mortality.
    JEL: C93 I12 I14
    Date: 2018–06
  4. By: Michael D. Frakes; Jonathan Gruber
    Abstract: We estimate the extent of defensive medicine by physicians, embracing the no-liability counterfactual made possible by the structure of liability rules in the Military Heath System. Active-duty patients seeking treatment from military facilities cannot sue for harms resulting from negligent care, while protections are provided to dependents treated at military facilities and to all patients—active-duty or not—that receive care from civilian facilities. Drawing on this variation and exploiting exogenous shocks to care location choices stemming from base-hospital closures, we find suggestive evidence that liability immunity reduces inpatient spending by 5% with no measurable negative effect on patient outcomes.
    JEL: I11 I18
    Date: 2018–07
  5. By: Geyer, Johannes (DIW Berlin); Haan, Peter (DIW Berlin); Hammerschmid, Anna (DIW Berlin); Peters, Michael (DIW Berlin)
    Abstract: We evaluate the labor market and distributional effects of an increase in the early retirement age (ERA) from 60 to 63 for women. We use a regression discontinuity design which exploits the immediate increase in the ERA between women born in 1951 and 1952. The analysis is based on the German micro census which includes about 370,000 households per year. We focus on heterogeneous labor market effects on the individual and on the household level and we study the distributional implications using net household income. In this respect we extend the previous literature which mainly studied employment effects on the individual level. Our results show sizable labor market effects which strongly differ by subgroups. We document larger employment effects for women who cannot rely on other income on the household level, e.g. women with a low income partner. The distributional analysis shows on average no significant effects on female or household income. This result holds as well for heterogeneous groups: Even for the most vulnerable groups, such as single women, women without higher education, or low partner income, we do not find significant reductions in income. One reason for this result is program substitution.
    Keywords: retirement age, pension reform, labor supply, early retirement, distributional effects, spillover effects, household
    JEL: J14 J18 J22 J26 H31
    Date: 2018–06
  6. By: Tatyana Deryugina; David Molitor
    Abstract: We follow Medicare cohorts over time and space to estimate Hurricane Katrina's long-run mortality effects on elderly and disabled victims initially living in New Orleans. Inclusive of the initial shock, the hurricane improved survival eight years past the storm by 1.74 percentage points. Migration to lower-mortality regions explains most of this survival increase. Migrants to low- versus high-mortality regions look similar at baseline, but migrants’ subsequent mortality is 0.83-0.90 percentage points lower for each percentage-point reduction in local mortality, quantifying causal effects of place on mortality among this population. By contrast, migrants’ mortality is unrelated to local Medicare spending.
    JEL: H51 I10 Q54 R23
    Date: 2018–07
  7. By: Corneliu Bolbocean; Frances A. Tylavsky; James E. West
    Abstract: A large body of literature suggests that the first years of life are critical for long-term economic, health and social outcomes. However, the effect of public programs on early life skills formation is largely unknown due to data limitations. In this paper we use novel data from a large longitudinal prospective cohort study to estimate the effects of WIC, SNAP, and home visitation programs on early life outcomes up to two years of age. We find that participation in these programs has a positive and statistically significant effect on language development and boosts early life noncognitive outcomes.
    JEL: H5 I1 I38
    Date: 2018–07
  8. By: Ariell Zimran
    Abstract: After adjusting for sample-selection bias, I find a net decline in average stature of 0.64 inches in the birth cohorts of 1832--1860 in the US. This result supports the veracity of the Antebellum Puzzle—a deterioration of health during early modern economic growth in the US. However, this adjustment alters the trend in average stature, validating concerns over bias in the historical heights literature. The adjustment is based on census-linked military height data and uses a two-step semi-parametric sample-selection model to adjust for selection on observables and unobservables.
    JEL: I15 N11 N31
    Date: 2018–07
  9. By: Philippe Ruh; Stefan Staubli
    Abstract: Most countries reduce Disability Insurance (DI) benefits for beneficiaries earning above a specified threshold. Such an earnings threshold generates a discontinuous increase in tax liability—a notch—and creates an incentive to keep earnings below the threshold. Exploiting such a notch in Austria, we provide transparent and credible identification of the effect of financial incentives on DI beneficiaries’ earnings. Using rich administrative data, we document large and sharp bunching at the earnings threshold. However, the elasticity driving these responses is small. Our estimate suggests that relaxing the earnings threshold reduces fiscal cost only if program entry is very inelastic.
    JEL: H53 H55 J14 J21
    Date: 2018–07
  10. By: Pohl, R. Vincent
    Abstract: Mortality due to opioid overdoses has been growing rapidly in the U.S., with some states experiencing much steeper increases than others. Legalizing medical cannabis could reduce opioid-related mortality if potential opioid users substitute towards cannabis as a safer alternative. I show, however, that a substantial reduction in opioid-related mortality associated with the implementation of medical cannabis laws can be explained by selection bias. States that legalized medical cannabis exhibit lower pre-existing mortality trends. Accordingly, the mitigating effect of medical cannabis laws on opioid-related mortality vanishes when I include state-specific time trends in state-year-level difference-in-differences regressions.
    Keywords: medical cannabis laws, opioid overdose mortality, difference-in-differences, group-specific time trends
    JEL: C23 I12 I18 K32
    Date: 2018–06–06
  11. By: Gabriella Conti (University College London); Rita Ginja (University of Bergen); Renata Narita (University of São Paulo)
    Abstract: Do households value access to free health insurance when making labor supply decisions? We answer this question using the introduction of universal health insurance in Mexico, the Seguro Popular (SP), in 2002. The SP targeted individuals not covered by Social Security and broke the link between access to health care and job contract. We start by using the rollout of SP across municipalities in a differences-in-differences approach, and find an increase in informality of 4% among low-educated families with children. We then develop and estimate a household search model that incorporates the pre-reform valuation of formal sector amenities relative to the alternatives (informal sector and non-employment) and the value of SP. The estimated value of the health insurance coverage provided by SP is below the government’s cost of the program, and the corresponding utility gain is, at most, 0.56 per each peso spent.
    Keywords: search, household behavior, health insurance, informality, unemployment
    JEL: J64 D10 I13
    Date: 2018–08
  12. By: Anup Malani; Sonia P. Jaffe
    Abstract: We analyze the financial value of insurance when individuals have access to credit markets. Loans allow consumers to smooth shocks across time, decreasing the value of the smoothing (across states of the world) provided by insurance. We derive a simple formula for the incremental value of insurance and show how it depends on individual age, health, and income and on the features of available loans. Our central contribution is to derive formulas for aggregate welfare that can be taken to data from typical studies of health insurance. We provide both exact formulas that can be taken to data on the distribution of medical expenditures and income and an approximate formula for aggregate data on medical expenditure. Using the Medical Expenditure Panel Survey we illustrate how the incremental value of insurance is decreasing with access to loans. For consumers in the sickest decile, access to a five-year loan decreases the incremental value of insurance by $338 (6%) on average and $3,433 (36%) for the poorest consumers. We also find that our approximate formula is a reasonable proxy for the exact one in our data.
    JEL: D14 D60 I13
    Date: 2018–07
  13. By: Zheng, Yan; Vukina, Tomislav; Zheng, Xiaoyong
    Abstract: We use a structural approach to separately estimate moral hazard and adverse selection effects in health care utilization using hospital invoices data. Our model explicitly accounts for the heterogeneity in the transactions costs associated with hospital visits which increase the individuals' total cost of health care and dampen the moral hazard effect. A measure of moral hazard is derived as the difference between the observed and the counterfactual health care consumption. In the population of patients with non life-threatening diagnoses, our results indicate statistically significant and economically meaningful moral hazard. We also test for the presence of adverse selection by investigating whether patients with different health status sort themselves into different health insurance plans. Adverse selection is confirmed in the data because patients with estimated worse health tend to buy the insurance coverage and patients with estimated better health choose not to buy the insurance coverage.
    Keywords: Health Economics and Policy
    Date: 2016–09–01
  14. By: Butikofer, Aline; Loken, Katrine; Salvanes, Kjell G
    Abstract: A growing literature documents the positive long-term effects of policy-induced improvements in early-life health and nutrition. However, there is still scarce evidence on early-life health programs targeting a large share of the population and the role of such programs in increasing intergenerational mobility. This paper uses the rollout of mother and child health care centers in Norway, which commenced in the 1930s, to study the long-term consequences over the whole life cycle of increasing access to well-child visits in the first year of life. These well-child visits included a physical examination and the provision of information about adequate infant nutrition. Our first results show that access to mother and child health care centers in the first year of life increased the completed years of schooling by 0.15 years and earnings by two percent. Our second set of results reveals that these effects were stronger for children from a low socioeconomic background and contribute to a 10 percent reduction in the persistence of educational attainment across generations. Our third set of findings suggest that better nutrition within the first year of life is a likely mechanism. In particular, we find positive effects on adult height and that individuals suffer from fewer health risks at age 40. In addition, we show that access to well-child visits decreased infant mortality from diarrhea whereas infant mortality from pneumonia, tuberculosis, or congenital malformations are not affected. Finally, we investigate the costs of the program and show that investments in mother and child healthcare centers pass a simple cost–benefit analysis.
    Keywords: child health; health care centers; long-term outcomes; nutrition
    JEL: I14 I18 I24
    Date: 2018–07
  15. By: Bijwaard, G.E.;; Tynelius, P.;
    Abstract: Mental disorders have a large impact on invalidity and mortality. Poor mental health is associated with low education, which is also associated with poor health and higher mortality. The association between mental health and mortality may, therefore, be partly explained by the increased incidence of mental problems of the low educated. An important issue is that mental health problems, education attainment and mortality may all depend on the same observed and unobserved individual factors. Such confounding renders both the incidence of mental health problems and education endogenous in the mortality analysis. We account for both the selective incidence of mental health problems and selective educational attainment by using a correlated multistate model for the mental health (hospitalization) process (both admittance an discharge) and mortality with a re-weighting technique (inverse propensity weighting) based on the probability to attain higher education. We use Swedish Military Conscription Data (1951-1960), linked to the administrative Swedish death and National Hospital Discharge registers. We observe the timing of admittance and discharge from mental hospitals, the moment and cause of death and the education level. We estimate the effect of mental hospitalization and education on the morality rate and how the effect of mental hospitalization is moderated by education. Our empirical results indicate a strong effect of both mental hospitalization and education on mortality. Mental hospitalization affects mortality due to external causes of death in particular. Only for the low educated improving education moderates the impact of mental hospitalization on mortality. We also found that ignoring confounding would overestimate the impact of mental hospitalization on mortality. Accounting for confounding in mental hospitalization seems to be more important than accounting for selective educational attainment.
    Keywords: Mental health; Education; Mortality; Timing-of-events; Inverse propensity weighting;
    JEL: C41 I14 I24
    Date: 2018–08
  16. By: Roozbeh Hosseini (University of Georgia); Kai Zhao (University of Connecticut); Karen Kopecky (Federal Reserve Bank of Atlanta)
    Abstract: Recent studies have identified health dynamics and health shocks as major sources of risk over the life cycle. Health has implications for many economic variables includ- ing asset accumulation, labor supply, and income and wealth inequality. Despite the importance of health in economic studies, there is no unified objective measure of health status. In this paper we propose such a measure: frailty, defined as the cumulative sum of all adverse health indicators observed for an individual. There is overwhelming evidence in the gerontology literature that this simple measure is a strong predictor of mortality and other health outcomes. We construct a frailty index for individuals in the PSID, HRS and MEPS separately and make the following three observations. One, our constructed frailty index is remarkably consistent across the three datasets in terms of persistence, and dynamics of its distribution. This is in contrast to the most commonly used measure of health, self-reported health status. Two, individuals’ health decays at a substantially faster pace over the lifecycle when measured by frailty as opposed to self-reported health status. Three, health status is more persistent when measured by frailty as opposed to self reported health status. We estimate a dynamic process for frailty over the life cycle and show that an important driver of increasing inequality in health with age is dispersion in growth rates of frailty across individuals. Our frailty measure and dynamic process can be used by economists to study the evolution of health status over the life cycle and its implications.
    Date: 2018
  17. By: Christopher Carpenter; Samuel T. Eppink; Gilbert Gonzales Jr.; Tara McKay
    Abstract: We exploit variation in access to legal same-sex marriage (SSM) across states and time to provide novel evidence of its effects on marriage and health using data from the CDC BRFSS from 2000-2016, a period spanning the entire rollout of legal SSM across the United States. Our main approach is to relate changes in outcomes for individuals in same-sex households (SSH) [i.e., households with exactly two same-sex adults], which we show includes a substantial share of gay and lesbian couples, coincident with adoption of legal SSM in two-way fixed effects models. We find robust evidence that access to legal SSM significantly increased marriage take-up among men and women in SSH. We also find that legal SSM was associated with significant increases in health insurance, access to care, and utilization for men in SSH. Our results provide the first evidence that legal access to SSM improved health for adult gay men.
    JEL: I1 K0
    Date: 2018–06
  18. By: Catherine Deri Armstrong (University of Ottawa, ON, Canada); Rose Anne Devlin (University of Ottawa, ON, Canada); Forough Seifi (University of Ottawa, ON, Canada)
    Abstract: Volunteers are reputedly healthier and happier than their non-volunteering counterparts. But is this a causal link or are healthier, happy individuals simply more likely to volunteer? Some papers have attempted to identify the causal relationship using an instrumental variable methodology; most relying on measures of religiosity as instruments for volunteering. No studies of such nature have been conducted in Canada. We rely on a novel instrument, a measure physical proximity to volunteer opportunities and use data from Canadian General Social Surveys to fill this gap. Employing a conditional mixed process (CMP) model, we find that volunteering is a robustly significant predictor of health, and positively affects life satisfaction for female and middle-aged individuals.
    Keywords: Volunteering; volunteering and health; volunteering and life satisfaction
    Date: 2018
  19. By: Julian Reif
    Abstract: Many consumer behaviors are both addictive and social. Understanding how these two phenomena interact informs basic models of human behavior, and matters for policymakers when the behavior is regulated. I develop a new model of demand that incorporates both addiction and social interactions and show that, under certain conditions, social interactions reinforce the effects of addiction. I also show how the dynamics introduced by addiction can solve the pernicious problem of identifying the causal effects of social interactions. I then use the model to illustrate a new and important identification problem for studies of social interactions: existing estimates cannot be used to draw welfare conclusions or even to deduce whether social interactions increase aggregate demand. Finally, I develop a method that allows researchers to distinguish between two common forms of social interactions and draw welfare conclusions.
    JEL: D11 D12 H0
    Date: 2018–07
  20. By: Roozbeh Hosseini (University of Georgia); Kai Zhao (University of Connecticut); Karen Kopecky (Federal Reserve Bank of Atlanta)
    Abstract: Health and earnings are positively correlated and this is for several reasons. First, individuals who are in poor health are significantly less likely to work than healthy individuals. Second, conditional on working, individuals in poor health work fewer hours on average. Third, individuals in poor health earn lower wages on average. We document these facts using an objective measure of health called a frailty index which we construct for PSID respondents. The frailty index measures the fraction of observable health deficits an individual has. In previous work, we documented that health, as measured by the frailty index, deteriorates more rapidly and has a larger increase in dispersion with age than self-reported health. It is also more persistent over the life-cycle. These facts put together suggest that health inequality over the life cycle may be an important driver of lifetime earnings inequality. To assess this claim we develop a model of the joint dynamics of health and earnings over the life cycle. Individuals in the model face health, earnings and unemployment risk, and optimally choose labor supply on both the intensive and extensive margin. Agents are partially insured against these risks through government-run unemployment and disability insurance programs. We give agents in the model a dynamic process for frailty (health) that is estimated using the PSID data. Because of selection concerns, agents' productivity processes, including the contribution of frailty to productivity, are estimated using the model and a method of moments estimation. Targeted moments are constructed off distributions of wages, hours, and participation by frailty and age. These distributions are obtained from an auxiliary simulation model that is estimated using PSID data. We find that health inequality can account for a significant share of the variation in lifetime earnings among 70 year-olds. Most of this effect is due to the fact that unhealthy individuals exit the labor force at much younger ages than healthy ones. We find that health inequality has a larger impact on earnings inequality than previous literature for two reason. One, our model is the first in this literature that allows health to impact earnings through all three margins: participation, hours, and wages (productivity). Two, previous literature measured health using self-reported health status and thus understated the extent to with health deteriorates with age for some individuals.
    Date: 2018
  21. By: Nigel Rice (Centre for Health Economics, University of York, York, UK); Maria Jose Aragon (Centre for Health Economics, University of York, York, UK)
    Abstract: Understanding the drivers of growth in health care expenditure is crucial for forecasting future health care requirements and to ameliorate inefficient expenditure. This paper considers the detailed breakdown of hospital inpatient expenditures across the period 2007/08 to 2014/15. Decomposition techniques are used to unpick the observed rise in expenditure into a component due to a change in the distribution of characteristics, for example, greater prevalence of morbidity, and a component due to structural changes in the impact of such characteristics on expenditures (coefficient effects, for example, due to technological change). This is undertaken at the mean using standard decomposition techniques, but also across the full distribution of expenditures to gain an understanding of where in the distribution growth and its determinants are most relevant. Decomposition at the mean indicates a larger role for a structural change in characteristics rather than a change in coefficients. A key driver is an increased prevalence of comorbidities. When considering the full distribution we observe a decrease in expenditure at the bottom of the distribution (bottom two quintiles) but increasing expenditure thereafter. The largest increases are observed at the top of the expenditure distribution. Where changes in structural characteristics dominate changes in coefficients in explaining the rise in expenditure. Increases in comorbidities (and the average number of first diagnoses) across the two periods, together with increases in non-elective long stay episodes and non-elective bed days are important drivers of expenditure increases.
    Keywords: English National Health Service, Health care expenditure growth, Decomposition analysis, Drivers of expenditure
    JEL: H51 J11 I19
    Date: 2018–07
  22. By: Fabrice Etilé (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, INRA - Institut National de la Recherche Agronomique, PSE - Paris School of Economics); Paul Frijters (CEPR - Center for Economic Policy Research - CEPR, LSE - London School of Economics and Political Science); David W. Johson (Monash University [Malaysia]); Michael A. Shields (Monash University [Malaysia])
    Abstract: Using a novel, dynamic finite mixture model applied to 12 years of nationally representative panel data, we explore individual heterogeneity in the total psychological response (our measure of resilience) to ten major adverse life events, including serious illness, redundancy and crime victimisation. Importantly, this model takes into account that individuals are not randomly selected into adverse events, that some events are anticipated in advance of their occurrence, and that the immediate psychological response and the speed of adaptation may differ across individuals. Additionally, we generate a ‘standardised event' in order to document the distribution of general resilience in the population. We find considerable heterogeneity in the response to adverse events, with the total psychological loss of people with low resilience being several times larger than the average loss. We also find that resilience is strongly correlated with clinical measures of mental health, but only weakly correlated with cognitive and non-cognitive traits. Finally, we find that resilience in adulthood to some extent is predictable by childhood socioeconomic circumstances; the strongest predictor we identify is good childhood health.
    Keywords: Psychological Health, Resilience, Life Events, Childhood, Panel,Data, Mixture Model
    Date: 2017–03
  23. By: Panle Jia Barwick; Shanjun Li; Deyu Rao; Nahim Bin Zahur
    Abstract: Developing and fast-growing economies have some of the worse air pollution in the world, but there is a lack of systematic evidence on the health especially morbidity impact of air pollution in these countries. Based on the universe of credit and debit card transactions in China from 2013 to 2015, this paper provides to our knowledge the first analysis of the morbidity cost of PM2.5 for the entire population of a developing country. To address potential endogeneity in pollution exposure, we construct an instrumental variable by modeling the spatial spillovers of PM2.5 due to long-range transport. We propose a flexible distributed-lag model that incorporates the IV approach to capture the dynamic response to past pollution exposure. Our analysis shows that PM2.5 has a significant impact on healthcare spending in both the short and medium terms that survives an array of robustness checks. The annual reduction in national healthcare spending from complying with the World Health Organization’s annual standard of 10 mg/m3 would amount to $42 billion, or nearly 7% of China’s total healthcare spending in 2015. In contrast to the common perception that the morbidity impact is modest relative to the mortality impact, our estimated morbidity cost of air pollution is about two-thirds of the mortality cost from the recent literature.
    JEL: I15 Q51 Q53
    Date: 2018–06
  24. By: Alan Fuchs; Giselle Del Carmen; Alfred Kechia Mukon
    Keywords: Health, Nutrition and Population - Cancer Health, Nutrition and Population - Health Economics & Finance Health, Nutrition and Population - Health and Poverty Health, Nutrition and Population - Tobacco Use and Control Macroeconomics and Economic Growth - Taxation & Subsidies Poverty Reduction - Living Standards
    Date: 2018–02
  25. By: Tingum, Ernest Ngeh; Parrott, Steve
    Abstract: Objective: This paper aims to estimate the demand for domestic and imported cigarettes using quarterly time series data from Rwanda. Method: Demand functions were estimated using the Autoregressive Distributive lag (ARDL) and the Seemingly Unrelated Regression (SUR) models. Data were derived from the Ministry of Finance through the Rwanda Revenue Authority (RRA). Results: The price elasticity of demand for domestic and imported cigarettes ranged from -0.479 and -0.875. This indicates that a 10% increase in real prices would reduce cigarette consumption by 4.79% to 8.75% in Rwanda. The estimates also found the price elasticity of the imported cigarettes to be higher than that of the domestic cigarettes, indicating that smokers are more responsive, or elastic, to price changes in imported cigarettes. Concerning cross price effects, the estimates indicate that domestic and imported cigarettes are complements with cross-price elasticities of -1.087 for domestic and -0.534 for imported cigarettes. Conclusion: Rates of taxation in Rwanda rate still remain significantly lower than those imposed by some developing countries, despite recent changes in tax policy. Our results show that an increase in the rates of excise tax on tobacco would have a significant effect in reducing cigarette consumption as well as generating additional tax revenues.
    Keywords: Demand, Elasticities, Imported, Domestic, Cigarettes, Rwanda
    JEL: I1 I15
    Date: 2018
  26. By: Sonya K Huffman, Iowa State University,; Marian Rizov, University of Lincoln,
    Abstract: This paper develops a theoretical framework and provides empirical evidence on the impacts of diet and lifestyles on life satisfaction in Russia using 1995-2005 data from the Russian Longitudinal Monitoring Survey. Our results suggest that diet measured as calories, fat, protein, and diversity of food consumption has a statistically significant effect on life satisfaction levels of the Russian population. In addition, living in a region with higher per capita income increases population’s life satisfaction. While living in a rural area, having health problems, and having young children affect individual life satisfaction in Russia in a negative and statistically significantly way. Life satisfaction is also positively correlated with education and income, and negatively with unemployment. Better understanding of the drivers of life satisfaction and more generally of subjective wellbeing in Russia can assist in the government decision-making processes, including the allocation of scarce resources and the design of public health policies.
    Keywords: Food Consumption/Nutrition/Food Safety, Health Economics and Policy, Institutional and Behavioral Economics
    Date: 2018–04–09
  27. By: Shuai Chen; Paulina Oliva; Peng Zhang
    Abstract: A large body of literature estimates the effect of air pollution on health. However, most of these studies have focused on physical health, while the effect on mental health is limited. Using the China Family Panel Studies (CFPS) covering 12,615 urban residents during 2014 – 2015, we find significantly positive effect of air pollution – instrumented by thermal inversions – on mental illness. Specifically, a one-standard-deviation (18.04 μg/m3) increase in average PM2.5 concentrations in the past month increases the probability of having a score that is associated with severe mental illness by 6.67 percentage points, or 0.33 standard deviations. Based on average health expenditures associated with mental illness and rates of treatment among those with symptoms, we calculate that these effects induce a total annual cost of USD 22.88 billion in health expenditures only. This cost is on a similar scale to pollution costs stemming from mortality, labor productivity, and dementia.
    JEL: I15 I18 O53 Q51 Q53
    Date: 2018–06
  28. By: Cheny, L.;; Clarke, P.M.;; Petrie, D.J.;; Staub, K.E.;
    Abstract: Categories of self-assessed health (SAH) are often used as a measure of health status. However,the difficulties with measuring overall health mean that the same individual may select into different SAH categories even though their underlying health has not changed. Thus,their observed SAH may involve misclassification, and the chance of misclassification may differ across individuals. As shown in this paper,if neglected, misclassification can lead to substantial biases in not only the estimation of the effects of SAH on outcomes, but also on the effects of other variables of interest,such as education and income. This paper studies nonlinear regression models where SAH is a key explanatory variable, but where two potentially misclassified measures of SAH are available.In contrast to linear regression models, the standard approach of using one SAH measure as an instrumental variable for the other cannot produce consistent estimates. However, we show that the coefficients can be identified from the joint distribution of the outcome and the two misclassified measures without imposing additional structure on the misclassification, and we propose simple likelihood-based approaches to estimate all parameters consistently via a convenient EM algorithm. The estimator is applied to data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey, where we exploit the natural experiment that in some waves individuals were asked the same question about their health status twice, and almost 30% of respondents change their SAH response. We use the estimator to (i) obtain the first reliable estimates of the relationship between SAH and long-term mortality and morbidity, and to (ii) document how demographic and socio-economic determinants shape patterns of misclassification of SAH.
    Keywords: misreporting; measurement error; multinomial regressor; discrete and limited dependent variables; subjective health; mortality; chronic conditions;
    JEL: C35 I12
    Date: 2018–08
  29. By: Cronin, C.J.;; Guilkey, D.K.;; Speizer, I.S.;
    Abstract: A number of authors have utilized health facility choice models to determine how individuals in developing countries evaluate the tradeoff between the price, quality, and indirect costs of obtaining medical care. A common problem in this literature is that researchers only observe the type of facility that individuals report visiting (e.g., public or private hospital, health center or dispensary, or traditional healer) and, therefore, must assume individuals visit the nearest facility of the type they report. This matching procedure creates measurement error in the choice variable, which may introduce bias in parameter estimates. In this research, we use a data set from urban Senegal that allows for a precise individual-health facility match to estimate consumer preferences for health facility characteristics related to maternal health and family planning services. Using actual rather than imputed choices, we find that consumers prefer high quality health facilities that are nearby. Given the preference for quality, our findings indicate that in contrast to the typical assumption in the literature, individuals frequently bypass the facility nearest their home. When we estimate models using the mismeasured choice variable, the results show a significant bias in preference estimates; most notably, these models systematically overestimate distaste for travel. To highlight a potential consequence of biased preference estimates in this setting, we conclude by simulating the impact of an actual policy that took place in 2014; namely, the opening of a new facility in a previously underserved area of Dakar, Senegal.
    Keywords: measurement error; discrete choice; health facility choice; maternal health; family planning; Senegal;
    JEL: I12 I15 I18 J13 C35
    Date: 2018–08
  30. By: FUJII, Tomoki (School of Economics, Singapore Management University)
    Abstract: Absenteeism of health workers in developing countries is common and can severely undermine the reliability of health system. Therefore, it is important to understand where the prevalence of absenteeism is high. We develop a simple imputation method that combines a Service Delivery Indicators survey and a Service Provision Assessment survey to estimate the prevalence of absenteeism of health workers at the level of regions in Tanzania. The resulting estimates allow one to identify the regions in which the prevalence of absenteeism is significantly higher or lower than the national average and help policymakers determine the priority areas for intervention.
    Keywords: Sub-Saharan Africa; primary health facility; imputation; random-effects probit; service delivery indicator
    Date: 2018–07–16
  31. By: Denis Cogneau (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, Institut de Recherche pour le Développement (IRD)); Pauline Rossi (PSE - Paris School of Economics, CREST - Centre de Recherche en Économie et Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - X - École polytechnique - ENSAE ParisTech - École Nationale de la Statistique et de l'Administration Économique)
    Abstract: Have malaria control efforts contributed to the reduction in infant mortality in Sub-Saharan Africa over the past 15 years? Using large household surveys collected in 19 countries between 2000 and 2015, we estimate the correlation between the distribution of bednets and the progress in child survival. We find that the large increase in bednets ownership observed between 2000 and 2015 is associated with a decrease in infant mortality by 1.3pp, which amounts to one third of the total decrease in infant mortality over the period. We further discuss to which extent this correlation might be interpreted as a causal impact.
    Keywords: Child mortality,Malaria,Africa,Foreign aid
    Date: 2017–01

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