nep-hea New Economics Papers
on Health Economics
Issue of 2019‒04‒15
thirty-two papers chosen by
Nicolas R. Ziebarth
Cornell University

  1. The Causal Effects of Education on Adult Health, Mortality and Income: Evidence from Mendelian Randomization and the Raising of the School Leaving Age By Davies, Neil; Dickson, Matt; Smith, George Davey; Windmeijer, Frank; van den Berg, Gerard J.
  2. Impact of Comprehensive Smoking Bans on the Health of Infants and Children: Evidence from the U.S. By McGeary, Kerry Anne; Dave, Dhaval M.; Lipton, Brandy; Roeper, Timothy
  3. Tobacco Sales Prohibition and Teen Smoking By Meier, Armando N.; Odermatt, Reto; Stutzer, Alois
  4. Effects of Maternal Work Incentives on Adolescent Social Behaviors By Dave, Dhaval M.; Corman, Hope; Kalil, Ariel; Schwartz-Soicher, Ofira; Reichman, Nancy E.
  5. The Impact of Public Health Insurance on Medical Utilization in a Vulnerable Population: Evidence from COFA Migrants By Timothy J. Halliday; Randall Q. Akee; Tetine Sentell; Megan Inada; Jill Miyamura
  6. The Human Capital Cost of Radiation: Long-run Evidence from Exposure outside the Womb By Benjamin Elsner; Florian Wozny
  7. The Phenomenon of Summer Diarrhea and Its Waning, 1910-1930 By Anderson, D. Mark; Rees, Daniel I.; Wang, Tianyi
  8. Promoting Breast Cancer Screening Take-Ups with Zero Cost: Evidence from an Experiment on Formatting Invitation Letters in Italy By Bertoni, Marco; Corazzini, Luca; Robone, Silvana
  9. Baby Bonuses and Early-Life Health Outcomes: Using Regression Discontinuity to Evaluate the Causal Impact of an Unconditional Cash Transfer By Lynch, John; Meunier, Aurélie; Pilkington, Rhiannon; Schurer, Stefanie
  10. Job loss, disability insurance and health expenditures By Aniko Biro; Peter Elek
  11. Understanding Job Transitions and Retirement Expectations Using Stated Preferences for Job Characteristics By Nicole Maestas; Kathleen J. Mullen; David Powell; Till von Wachter; Jeffrey Wenger
  12. Credit Where It's Due: Investigating Pathways from EITC Expansion to Maternal Mental Health By Gangopadhyaya, Anuj; Blavin, Fredric; Gates, Jason; Braga, Breno
  13. Dynamic Hospital Competition Under Rationing by Waiting Times By Luís Sá; Luigi Siciliani; Odd Rune Straume
  14. Hospital Competition in the National Health Service: Evidence from a Patient Choice Reform By Kurt R. Brekke; Chiara Canta; Luigi Siciliani; Odd Rune Straume
  15. Digital Waste? Unintended Consequences of Health Information Technology By Böckerman, Petri; Kortelainen, Mika; Laine, Liisa T.; Nurminen, Mikko; Saxell, Tanja
  16. Disability and the Unionized Workplace By Ameri, Mason; Ali, Mohammad; Schur, Lisa; Kruse, Douglas L.
  17. Insurance with a deductible. A way out of the long term care insurance By KLIMAVICIUTE Justina,; PESTIEAU Pierre,
  18. Interactions between Social and Topping Up Insurance under ex-post Moral Hazard By Rosalind Bell-Aldeghi
  19. How Does Contingent Work Affect SSDI Benefits? By Matthew S. Rutledge; Alice Zulkarnain; Sara Ellen King
  20. Body weight and United States economic development, 1840-1940. By Scott A. Carson
  21. Weight, Reference Points, and the Onset of Eating Disorders By Tiziano Arduini; Daniela Iorio; Eleonora Patacchini
  22. The impact of new drug launches on hospitalization in 2015 for 67 medical conditions in 15 OECD countries: a two-way fixed-effects analysis By Frank R. Lichtenberg
  23. The Relationship between Occupational Requirements and SSDI Activity By Matthew S. Rutledge; Alice Zulkarnain; Sara Ellen King
  24. Healthcare Spending Inequality: Evidence from Hungarian Administrative Data By Aniko Biro; Daniel Prinz
  25. Investigating the Difference in Mortality Estimates between the Social Security Administration Trustees' Report and the Human Mortality Database By Magali Barbieri
  26. Motivating Bureaucrats through Social Recognition: External Validity — A Tale of Two States By Gauri, Varun; Jamison, Julian C.; Mazar, Nina; Ozier, Owen
  27. Living Conditions and the Mental Health and Well-being of Refugees: Evidence from a Representative German Panel Study By Lena Walther; Lukas M. Fuchs; Jürgen Schupp; Christian von Scheve
  28. Early Life Exposure to Above Average Rainfall and Adult Mental Health By Mochamad Pasha; Marc Rockmore; Chih Ming Tan
  29. Willingness to Pay for Mortality Risk Reduction from Air Quality Improvement: Evidence from Urban Bangladesh By Minhaj Mahmud; Yasuyuki Sawada; Eiji Yamada
  30. Can Simple Psychological Interventions Increase Preventive Health Investment? By Johannes Haushofer; Anett John; Kate Orkin
  31. Throwing the Baby out with the Drinking Water: Unintended Consequences of Arsenic Mitigation Efforts in Bangladesh By Nina Buchmann; Erica M. Field; Rachel Glennerster; Reshmaan N. Hussam
  32. Post-intervention morbidity and growth among Zambian children who received multiple micronutrient supplementation using spirulina platensis: evidence from a randomized trial in Zambia By Masuda, Kazuya; Chitundu, Maureen

  1. By: Davies, Neil (University of Bristol); Dickson, Matt (University of Bath); Smith, George Davey (University of Bristol); Windmeijer, Frank (University of Bristol); van den Berg, Gerard J. (University of Bristol)
    Abstract: We compare estimates of the effects of education on health and health behaviour using two different instrumental variables in the UK Biobank data. One is based on a conventional natural experiment while the other, known as Mendelian randomization (MR), is based on genetic variants. The natural experiment exploits a compulsory schooling reform in the UK in 1972 which involved raising the minimum school leaving age (RoSLA). MR exploits perturbations of germline genetic variation associated with educational attainment, which occur at conception. It has been widely used in epidemiology and clinical sciences. Under monotonicity, each IV identifies a LATE, with potentially different sets of compliers. The RoSLA affected the amount of education for those at the lower end of the ability distribution whereas MR affects individuals across the entire distribution. We find that estimates using each approach are remarkably congruent for a wide range of health outcomes. Effect sizes of additional years of education thus seem to be similar across the education distribution. Our study corroborates the usefulness of MR as a source of instrumental variation in education.
    Keywords: returns to education, health, instrumental variables, RoSLA, genomic confounding, LATE
    JEL: H52 I12 I21 I28
    Date: 2019–03
  2. By: McGeary, Kerry Anne (Robert Wood Johnson Foundation); Dave, Dhaval M. (Bentley University); Lipton, Brandy (San Diego State University); Roeper, Timothy (New York University)
    Abstract: As evidence of the negative effects of environmental tobacco smoke (ETS) has mounted, an increasingly popular public policy response has been to impose restrictions on smoking through 100% smoke-free bans (comprehensive smoking bans). Yet sparse information exists regarding the impact these smoking bans at the state and local levels have on the health of children and infants. A rationale for expansion of smoke-free laws implicitly presumes that potential public health gains from reducing adult cigarette consumption and declines in adult ETS exposure extend to children. However, if smokers compensate by shifting their consumption of cigarettes from public venues that impose a comprehensive smoking ban to smoking at home, then these policies may have a harmful effect on children and infants. This study provides estimates of how comprehensive smoking bans impact the venue of smoking, and the health of children and infants. Using models that exploit state- and county-level changes to smoking ban legislation over time, estimates suggest that smoking bans have improved the health of both infants and children, mainly through implementation of more comprehensive bans. Further, we find no evidence of displacement among smokers (both smokers with and without children in the household), and actually find that the bans had a positive spillover effect in terms of reducing smoking inside the home – an effect which may further explain the improvement in infant and children's health. Our effect magnitudes imply that expanding comprehensive coverage from 60% (current level) to 100% of the population can prevent between approximately 1,110 – 1,750 low birthweight births among low-educated mothers, resulting in economic cost savings of about $71 – $111 million annually. Health improvements among older children add to these economic benefits.
    Keywords: smoking ban, infants, children, health, smoking restrictions, compensatory behaviors, smoke-free air laws, prenatal smoking, secondhand smoke, maternal smoking
    JEL: D1 I1
    Date: 2019–03
  3. By: Meier, Armando N. (University of Basel); Odermatt, Reto (University of Basel); Stutzer, Alois (University of Basel)
    Abstract: We evaluate one of the most prevalent prohibitory policies: banning the sales of tobacco to teens. We exploit the staggered introduction of sales bans across Switzerland and the European Union from 1990 to 2016. The estimates indicate a less than 1 percentage point reduction in teen smoking because of the bans. The reduction is substantially lower than the 5 percentage point reduction expected by health officials. We examine additional outcomes relevant to assessing any prohibitory policy. We find that teens circumvent the bans through peers. Moreover, they consider smokers less cool but do not think smoking is more dangerous.
    Keywords: prohibition, tobacco sales bans, youth smoking, attitudes toward smoking, tobacco prevention
    JEL: D12 I12 I18 K42
    Date: 2019–03
  4. By: Dave, Dhaval M. (Bentley University); Corman, Hope (Rider University); Kalil, Ariel (University of Chicago); Schwartz-Soicher, Ofira (Princeton University); Reichman, Nancy E. (Rutgers University)
    Abstract: This study investigates the effects of welfare reform in the U.S. in the 1990s, which dramatically limited cash assistance for low-income families, on the next generation as they transition to adulthood. We estimate effects by gender and focus on behaviors that are important for socioeconomic and health trajectories and represent early observable consequences of the reforms for the next generation. Using two nationally-representative datasets, we exploit differences in welfare reform implementation across states and over time in a difference-in-difference-in-differences framework to identify plausibly causal effects of welfare reform on a range of prosocial and antisocial behaviors (volunteering, participating in clubs/teams/activities, skipping school, getting into fights, damaging property, stealing, hurting others, smoking, using alcohol, using marijuana, using other illicit drugs). We explore maternal employment, supervision, and child's employment when not in school as potential mediators. We find that: (1) Welfare reform had no favorable effects on any of the youth behaviors examined. (2) Welfare reform led to a decrease in volunteering among girls. (3) Welfare reform led to increases in skipping school, damaging property, and getting into fights among boys. (4) Welfare reform led to increases in smoking and drug use among both boys and girls, with generally larger effects for boys (e.g., approximately 6% for boys compared to 4% for girls for any substance use). (5) The mediators we are able to consider explain little of the observed effects of welfare reform. Overall, the results from this study suggest that the intergenerational effects of welfare reform on adolescent behaviors were unfavorable, particularly for boys, and do not support longstanding arguments that incentivizing maternal employment by limiting cash assistance leads to responsible behavior in the next generation. As such, the social gains of welfare reform for women found in previous studies may have come at a cost to the next generation, particularly to boys who have been falling behind girls in terms of high school completion for decades.
    Keywords: welfare reform, maternal work, substance use, violence, school, intergenerational, adolescents, risky behaviors
    JEL: H53 I12 I31 I38
    Date: 2019–03
  5. By: Timothy J. Halliday (University of Hawaii at Manoa, UHERO, IZA); Randall Q. Akee (Brookings Institution and UCLA (on-leave), IZA, NBER); Tetine Sentell (University of Hawaii at Manoa); Megan Inada (Kokua Kalihi Valley Comprehensive Family Services); Jill Miyamura (Hawaii Health Information Corporation)
    Abstract: In March of 2015, the State of Hawaii stopped covering the vast majority of migrants from countries belonging to the Compact of Free Association (COFA) in the state Medicaid program. As a result COFA migrants were required to obtain private insurance in health insurance exchanges established under the Affordable Care Act. Using statewide administrative hospital discharge data, we show that Medicaid-funded hospitalizations and emergency room visits declined in this population by 69% and 42% after the expiration of Medicaid eligibility. Utilization funded by private insurance did increase but not enough to offset the declines in publicly-funded utilization. This resulted in a net decrease in utilization. In addition, we show that uninsured ER visits increased as a consequence of the expiration of Medicaid benefits. Paradoxically, we also find a substantial increase in Medicaid-funded ER visits by infants after the expiration of benefits which is consistent with a substitution of ER visits for ambulatory care for the very young.
    Keywords: Immigration, Health Insurance, Cost Sharing, Medicaid, Insurance Exchange
    JEL: I10 I14 J61
    Date: 2019–04
  6. By: Benjamin Elsner (University College Dublin, School of Economics); Florian Wozny (Institute of Labor Economics (IZA))
    Abstract: This paper studies the long-term effect of radiation on cognitive skills. We use regional variation in nuclear fallout caused by the Chernobyl disaster in 1986, which led to a permanent increase in radiation levels in most of Europe. To identify a causal effect, we exploit the fact that the degree of soil contamination depended on rainfall within a critical ten-day window after the disaster. Based on unique geo-coded survey data from Germany, we show that people who lived in highlycontaminated areas in 1986 perform significantly worse in standardized cognitive tests 25 years later. This effect is driven by the older cohorts in our sample (born before 1976), whereas we find no effect for people who were first exposed during early childhood. These results are consistent with radiation accelerating cognitive decline during older ages. Moreover, they suggest that radiation has negative effects even when people are first exposed as adults, and point to significant external costs of man-made sources of radiation.
    Keywords: Environment, Human Capital, Radioactivity, Cognitive Skills
    JEL: J24 Q53
    Date: 2019–01
  7. By: Anderson, D. Mark (Montana State University); Rees, Daniel I. (University of Colorado Denver); Wang, Tianyi (University of Pittsburgh)
    Abstract: During the first two decades of the 20th century, diarrheal deaths among American infants and children surged every summer. Although we still do not know what pathogen (or pathogens) caused this phenomenon, the consensus view is that it was eventually controlled through public health efforts at the municipal level. Using data from 26 major American cities for the period 1910-1930, we document the phenomenon of summer diarrhea and explore its dissipation. We find that water filtration is associated with a 15-17 percent reduction in diarrheal mortality among children under the age of two during the non-summer months, but does not seem to have had an effect on diarrheal mortality during the summer. In general, we find little evidence to suggest that public health interventions undertaken at the municipal level contributed to the dissipation of summer diarrhea. Our results are relevant for many parts of the developing world today, where climate change is expected to affect the length and intensity of seasons as well as the incidence of diarrheal diseases.
    Keywords: diarrheal mortality, infant mortality, public health
    JEL: I10 I18 N3 Q54
    Date: 2019–03
  8. By: Bertoni, Marco (University of Padova); Corazzini, Luca (Ca' Foscari University of Venice); Robone, Silvana (University of Insubria)
    Abstract: We ran a randomized field experiment to ascertain whether a costless manipulation of the informational content (restricted or enhanced information) and the framing (gain or loss framing) of the invitation letter to the breast cancer screening program in Messina, Italy, affects the take-up rate. We show that giving enhanced loss-framed information about the risks of not having a mammography increases the take-up. This manipulation is especially effective among subjects with lower baseline take-ups – those living farther away from the screening site, residing in municipalities with low education, or with no recent screening experience – contributing to reduce socio-economic inequalities in screening. When we investigate the mechanisms behind our findings, we show that subjects exposed to our proposed manipulation are also less likely to postpone the appointment, signaling enhanced awareness about the risks related with delayed participation.
    Keywords: breast cancer screening, framing, information provision, randomized field experiment
    JEL: C93 H51 I11 I18
    Date: 2019–03
  9. By: Lynch, John (University of Adelaide); Meunier, Aurélie; Pilkington, Rhiannon (University of Adelaide); Schurer, Stefanie (University of Sydney)
    Abstract: We use administrative data from South Australia to study the impact of an unconditional cash transfer on child health. We use the unanticipated introduction of the Australian Baby Bonus (ABB), a one-off payment of AU$3,000 (US$2,400) made to families with a newborn, to isolate its causal effect. The ABB reduces the number of potentially preventable hospitalizations and emergency department presentations for respiratory problems in the first year of life. Findings from survey data suggest that households spent the windfall income on electricity and private health insurance. There is no robust evidence that the ABB increased accidents or non-essential good consumption.
    Keywords: unconditional cash transfers, baby bonus, child respiratory health, health care utilization, regression discontinuity design, natural experiment, linked administrative data
    JEL: I14 I38
    Date: 2019–03
  10. By: Aniko Biro (“Lendület” Health and Population Research Group Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences); Peter Elek (Department of Economics, Eötvös Loránd University (ELTE) and “Lendület” Health and Population Research Group Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences)
    Abstract: We analyse the causal effect of job loss on disability insurance enrolment on a five-year horizon and the implications on health expenditures. Using individual level administrative panel data from Hungary, we follow individuals displaced due to a mass lay-off and compare their labour force status to non-laid-off individuals with similar employment and health history, chosen with propensity score matching. According to our estimates, being laid off increases the transition probability to disability by 50% (or 1.4% points) in four years, and half of the excess transitions occur within the first year. We find a greater than average effect among older individuals and those who were in worse health before. Outpatient, inpatient and pharmaceutical expenditure increases 3.5-4 times when a laid-off individual takes up disability benefit, and decreases slightly afterwards, but does not reach the pre-disability levels. This health expenditure pattern resembles that observed around the diagnosis of previously undetected chronic diseases, such as diabetes or hypertension, but genuine health shocks may also be present. The increase in health expenditure corresponds to 20-25% of the additional disability payments in the medium term.
    Keywords: administrative panel data, disability insurance, displacement, health expenditures
    JEL: C23 I12 I38 J63
    Date: 2019–03
  11. By: Nicole Maestas (Harvard University and NBER); Kathleen J. Mullen (RAND); David Powell (RAND); Till von Wachter (University of California Los Angeles and NBER); Jeffrey Wenger (RAND)
    Abstract: As the population ages in the United States and other countries, encouraging older individuals to work would help counter increasing dependency ratios and improve national economic outcomes. Extending working lives is likely not simply a function of improving monetary incentives. Instead, job characteristics are also potentially important, yet understudied, determinants of whether individuals near retirement remain in the labor force. We use previously-collected data on job characteristics and preferences for job characteristics and work at older ages from the 2015 American Working Conditions Survey. We match the 2015 data with new data on job transitions collected three years after the initial survey. We use the matched data to study the relationship between preferences for job characteristics and actual job transitions. We then estimate heterogeneity in preferences for job characteristics as a function of age and plans for retirement. We test whether preferences differ for older workers ages 50 to 61 with different self-perceived probabilities of working in the future. Finally, we test whether preferences differ for retirement-aged individuals ages 62 and older who are working or not working.
    Date: 2019–02
  12. By: Gangopadhyaya, Anuj (Urban Institute); Blavin, Fredric (Urban Institute); Gates, Jason (Urban Institute); Braga, Breno (Urban Institute)
    Abstract: While Earned Income Tax Credit (EITC) expansions are typically associated with improvements in maternal mental health, little is known about the mechanisms through which the program affects this outcome. The EITC could affect mental health through direct tax credit, changes in labor supply and changes in health insurance coverage of participants. To disentangle these mechanisms, we assess the effects of state and federal EITC expansion on mental health, employment and health insurance by maternal marital status. We find that federal EITC expansions are associated with 1) large positive effects on employment for unmarried mothers and 2) improved self-reported mental health for all mothers. State EITC expansion, which generate smaller changes in the effective wage rate, are associated with improvements in mental health for married mothers only and have no effect on employment for married or unmarried mothers. We find no impact of EITC expansions on health insurance coverage for married or unmarried mothers. These findings suggest that while EITC expansions improved mental health for unmarried mothers through a combination of the credit and employment, for married mothers, improved mental health is driven through the direct credit alone.
    Keywords: earned income tax credit, state earned income tax credit, maternal mental health, labor supply, health insurance coverage
    JEL: H24 I12 I14
    Date: 2019–03
  13. By: Luís Sá (University of Minho, Department of Economics/NIPE); Luigi Siciliani (University of York, Department of Economics and Related Studies); Odd Rune Straume (University of Minho, Department of Economics/NIPE)
    Abstract: We develop a dynamic model of hospital competition where (i) waiting times increase if demand exceeds supply; (ii) patients differ in their evaluation of health benefits and choose a hospital based on waiting times; and (iii) there are penalties for providers with long waits. We show that, if penalties are linear in waiting times, a more competitive dynamic environment does not affect waiting times. If penalties are instead non-linear, we find that waiting times are longer under the more competitive environment. The latter result is derived by calibrating the model with waiting times and elasticities observed in the English NHS for a common treatment (cataract surgery), which also shows that the difference between waiting times under the two solution concepts is quantitatively small. Policies that facilitate patient choice, an alternative measure of competition, also lead to higher steady-state waiting times, and tougher penalties exacerbate the negative effect of choice policies.
    Keywords: Hospital competition; waiting times; differential games.
    JEL: C73 H42 I11 I18 L42
    Date: 2018
  14. By: Kurt R. Brekke (Norwegian School of Economics (NHH)); Chiara Canta (Toulouse Business School); Luigi Siciliani (University of York, Department of Economics and Related Studies); Odd Rune Straume (University of Minho, Department of Economics/NIPE)
    Abstract: We study the impact of exposing hospitals in a National Health Service (NHS) to non-price competition by exploiting a patient choice reform in Norway in 2001. The reform facilitates a dfference-in-difference research design due to geographical variation in the scope for competition. Using rich administrative data covering the universe of NHS hospital admissions from 1998 to 2005, we find that hospitals in more competitive areas have a sharper reduction in AMI mortality, readmissions, and length of stay than hospitals in less competitive areas. These results indicate that competition improves patient health outcomes and hospital cost efficiency, even in the Norwegian NHS with large distances, low fixed treatment prices, and mainly public hospitals.
    Keywords: Patient Choice; Hospital Competition; Quality; Cost-efficiency
    JEL: I11 I18 L13
    Date: 2018
  15. By: Böckerman, Petri; Kortelainen, Mika; Laine, Liisa T.; Nurminen, Mikko; Saxell, Tanja
    Abstract: We exploit a large-scale natural experiment - the rollout of a nationwide electronic prescribing system in Finland - to study how digitization of prescriptions affects pharmaceutical use and health outcomes. We use comprehensive administrative data from patients treated with benzodiazepines, which are globally popular, effective but addictive psychotropic medications. We find no impact on benzodiazepine use on average, but among younger patients e-prescribing increases repeat prescription use. Younger patients' health outcomes do not improve but adverse outcomes, such as prescription drug abuse disorders and suicide attempts, increase dramatically. Improving access to medication through easier ordering may thus increase medication overuse.
    Keywords: health information technology, electronic prescribing, repeat prescriptions, inefficiency, medication overuse, Local public finance and provision of public services, H51, H75, I12, I18,
    Date: 2019
  16. By: Ameri, Mason (Rutgers University); Ali, Mohammad (Pennsylvania State University); Schur, Lisa (Rutgers University); Kruse, Douglas L. (Rutgers University)
    Abstract: The employment of people with disabilities has received significant attention, but little is known about how unions affect their employment experiences. To address this, we analyze monthly U.S. Current Population Survey (CPS) data from 2009 through 2017 and find that the unionization rate declined more rapidly among employees with disabilities. The results are not due to demographic or occupational factors, but to the lower rate at which people with disabilities are hired into unionized jobs. This lower hiring rate more than offsets the greater job retention of unionized workers with disabilities. Given that employers generally control hiring, it appears they are particularly reluctant to hire people with disabilities into jobs with union protections. Overall, in the union context, workers with disabilities appear more likely to be "last hired," but less likely to be "first fired." We also find that a union wage premium of 29.8% for workers with disabilities is greater than the 23.9% premium for workers without disabilities. There remains a pay gap of -5.7% between union workers with and without disabilities, compared to a -10.1% pay gap between non-union workers with and without disabilities. Exploratory data reveal that both union coverage and disability status increase the likelihood of requesting accommodations, supporting the voice model of unions. Overall the results indicate that while unions appear to help workers with disabilities in the U.S., unionized positions are becoming less available to workers with disabilities.
    Keywords: disability, unions, wage differentials, job mobility
    JEL: J14 J51 J31
    Date: 2019–03
  17. By: KLIMAVICIUTE Justina, (Vilnius University); PESTIEAU Pierre, (Université de Liège, CORE, UCLouvain and Toulouse School of Economics)
    Abstract: Long-term care (LTC) is one of the largest uninsured risks facing the elderly. In this paper, we first survey the standard causes of what has been dubbed the LTC insurance puzzle and then suggest that a possible way out of this puzzle is to make the reimbursement formula less threatening for those who fear a too long period of dependence. We adopt a reimbursement formula resting on Arrow’s theorem of the deductible, i.e. that it is optimal to focus insurance coverage on the states with largest expenditures. It implies full self-insurance coverage on the states with largest expenditures. It implies full self-insurance for the first years of dependency followed by full insurance thereafter. We show that this result remains at work with ex post moral hazard.
    Keywords: long-term care insurance, deductible, Arrow’s theorem, reimbursement rule
    JEL: G22 I13 J14
    Date: 2019–01–29
  18. By: Rosalind Bell-Aldeghi (Université de Bourgogne Franche-Comté, CRESE; LIRAES (EA4470), Université de Paris Descartes)
    Abstract: As health expenditure and need for corresponding funding rises, resorting to topping up insurance can seem natural. Complementary and supplementary insurances are both topping up contracts and, as such, are treated as one in the theoretical literature on optimal insurance. We argue that distinguishing them is crucial, and should be considered carefully when defining policies impacting the structure of the health insurance system, as these two kinds of insurance can have opposite effects on social insurance coverage. In this model, the optimal social insurance rate is defined endogenously and varies according to redistribution and the ex-post moral hazard characteristics of the insurance. This game has three stages and is solved through backward induction. The optimal social insurance rate is chosen first, by maximising social welfare. Second, individuals choose their private complementary and supplementary contracts. In the third stage they decide on their level of labour and consumption of health and other goods. Results indicate that whereas the presence of complementary insurance decreases the optimal size of social insurance, the offset effects of supplementary insurance can improve welfare.
    Date: 2019–02
  19. By: Matthew S. Rutledge; Alice Zulkarnain; Sara Ellen King
    Abstract: Some studies have found that contingent workers – including independent contractors, consultants, and those in temporary, on-call, and “gig economy” jobs – make up an increasing share of the labor force. How does this group of workers interact with Social Security Disability Insurance (SSDI)? This project uses the Health and Retirement Study linked to administrative data on SSDI applications and earnings to answer this question. Specifically, the paper examines how SSDI application, receipt, potential benefits, and insurance status differ for workers who hold contingent arrangements in their 50s and early 60s, compared to those who work in more traditional jobs at those ages. This study is among the first to examine how contingent work is likely to affect participation in a public program, specifically disability benefits. The study finds that SSDI application rates are about one-quarter smaller for older eligible contingent workers than for traditional workers of the same ages. Contingent workers are also about one-third less likely to be awarded disability benefits. The lower application and award rates are likely due in part to contingent workers’ lower eligibility rates and lower potential benefits. The application and award rates are also lower for contingent workers who have a chronic condition, work limitation, or limitation in their Activities of Daily Living. These results suggest that contingent workers would benefit from a greater availability of information and assistance in navigating the SSDI application process.
    Date: 2019–02
  20. By: Scott A. Carson
    Abstract: When traditional measures for material and economic welfare are scarce or unreliable, height and the body mass index (BMI) are now widely accepted measures that represent cumulative and current net nutrition in development studies. However, as the ratio of weight to height, BMI does not fully isolate the effects of current net nutrition. After controlling for height as a measure for current net nutrition, this study uses the weight of a sample of international men in US prisons. Throughout the late 19th and early 20th centuries, individuals with darker complexions had greater weights than individuals with fairer complexions. Mexican and Asian populations in the US had lower weights and reached shorter statures. Black and white weights stagnated throughout the late 19th and early 20th centuries. Agricultural workers’ had greater weights than workers in other occupations.
    Keywords: weight, 19th century current net nutrition, US race relations
    JEL: I10 J11 J71 N31
    Date: 2019
  21. By: Tiziano Arduini (University of Bologna); Daniela Iorio (University of Bologna); Eleonora Patacchini (Cornell University, EIEF, CEPR and IZA)
    Abstract: We investigate whether the development of eating disorders, in the form of purging, is influenced by peers’body size through interpersonal comparisons. Using detailed information on recent cohorts of U.S. teenagers, we document a sizeable and significant negative effect of high school peers’ body mass index (BMI) on purging behavior during the adolescence for females, but not for males. Interpersonal comparisons operate through the formation of a distorted self-perception: teenage girls with relatively thin female peers perceive themselves as heavier than they actually are. The girls who are more susceptible to peer influences are those having peers who are thinner, more popular, more (verbally) able, and with more educated parents.
    Date: 2019
  22. By: Frank R. Lichtenberg
    Abstract: There are two types of prescription drug cost offsets. The first type of cost offset—from prescription drug use—is primarily about the effect of changes in drug quantity (e.g. due to changes in out-of-pocket drug costs) on other medical costs. The second type of cost offset—the cost offset from prescription drug innovation—is primarily about the effect of prescription drug quality on other medical costs. Two previous studies found that pharmaceutical innovation reduced hospitalization, and that the reduction in hospital cost from the use of newer drugs was considerably greater than the innovation-induced increase in pharmaceutical expenditure. In this study, we reexamine the impact that pharmaceutical innovation has had on hospitalization, employing a different type of 2-way fixed effects research design. We estimate the impact that new drug launches that occurred during the period 1982-2015 had on hospitalization in 2015 for 67 diseases in 15 OECD countries. Our models include both country fixed effects and disease fixed effects, which control for the average propensity of people to be hospitalized in each country and from each disease. The number of hospital discharges and days of care in 2015 is significantly inversely related to the number of drugs launched during 1982-2005, but not significantly related to the number of drugs launched after 2005. (Utilization of drugs during the first few years after they are launched is relatively low, and drugs for chronic conditions may have to be consumed for several years to achieve full effectiveness.) The estimates imply that, if no new drugs had been launched after 1981, total days of care in 2015 would have been 163% higher than it actually was. The estimated reduction in 2015 hospital expenditure that may be attributable to post-1981 drug launches was 5.3 times as large as 2015 expenditure on those drugs.
    JEL: I10 L65 O33
    Date: 2019
  23. By: Matthew S. Rutledge; Alice Zulkarnain; Sara Ellen King
    Abstract: Evaluations of Social Security Disability Insurance (SSDI) applications are based not just on poor health, but in most cases consider the vocational factors of age, education and work experience to determine whether individuals can work. These criteria indicate that SSDI applicants must not only be in poor health, but in poor health that actually conflicts with the requirements of their occupation (and other occupations). Yet little is known about the relationship between SSDI activity and the ability to meet occupational requirements. This study devises a Health Mismatch Index, which is the share of workers in an occupation citing health-related difficulties in the Survey of Income and Program Participation that would prevent them from performing at least one requirement marked as essential for their occupation in the Occupational Requirement Survey. The results show that the most common difficulties in required abilities that result in health mismatch are lifting 25 lbs., standing for one hour, or hearing well in a conversational setting. Furthermore, occupations with a high Index have lower earnings, are more exposed to hazardous environments, and place less emphasis on high performance and problem-solving. Jobs with higher rates of workers who experience at least one difficulty with a job requirement have a higher share of workers receiving SSDI benefits within a 16-month period. Although the share of the population receiving SSDI increased from 1997 to 2010, the Index fell from 7.4 to 6.1 percent, suggesting that the increase could have been higher if not for the decline in health mismatch.
    Date: 2019–02
  24. By: Aniko Biro (“Lendület” Health and Population Research Group Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences); Daniel Prinz (Health Policy and Economics at Harvard and a Pre-Doctoral Fellow in Disability Policy Research at NBER)
    Abstract: Using administrative data on incomes and healthcare spending, we develop new evidence on the distribution of healthcare spending in Hungary. We document substantial geographic heterogeneity and a positive association between income and public healthcare spending.
    Keywords: administrative data, healthcare expenditures, inequality
    JEL: H51 I14 I18
    Date: 2019–03
  25. By: Magali Barbieri (University of California-Berkeley)
    Abstract: This study’s goal was to determine whether differences in data or differences in methods explain the divergence between the mortality estimates at ages 65 and older of the Social Security Administration (SSA) and the Human Mortality Database (HMD). These differences, increasing since 1968, are an issue of significant value considering the importance of SSA estimates and projections to determine the long term solvency of the Social Security Trust Funds, as well as of other government programs such as Medicare and Medicaid. The two organizations use different data and different methods to construct their estimates. In particular, the HMD relies on national statistics from the vital registration system and the Census Bureau, while the SSA uses Medicare program enrollment data. Applying the SSA methods to the HMD data showed that differences in the data, rather than in the methods, explain the entire gap in life expectancy at age 65, with the HMD indicator 0.4 years higher for 2014 than the SSA. The study also determined that the gap resulted mostly from lower mortality rates at ages 65 to 84 years (rather than at 85 and older) up to about 2005 to 2006, but that the growing divergence since then is nearly entirely due to increasingly lower mortality at ages above 85. The pattern was found to be similar for men and for women, though the gap is slightly larger for the latter. Additional investigations, with more detailed data, will be necessary to assess whether data reliability or issues of representativeness explain the difference.
    Date: 2018–09
  26. By: Gauri, Varun (World Bank); Jamison, Julian C. (University of Exeter); Mazar, Nina (Boston University); Ozier, Owen (World Bank)
    Abstract: Bureaucratic performance is a crucial determinant of economic growth, but little real-world evidence exists on how to improve it, especially in resource-constrained settings. We conducted a field experiment of a social recognition intervention to improve record keeping in health facilities in two Nigerian states, replicating the intervention - implemented by a single organization - on bureaucrats performing identical tasks. Social recognition improved performance in one state but had no effect in the other, highlighting both the potential benefits and also the sometimes-limited generalizability of behavioral interventions. Furthermore, differences in facility-level observables did not explain cross-state differences in impacts, suggesting that it may often be difficult to predict external validity.
    Keywords: RCT, external validity, bureaucracy, behavioral insights, nudges, healthcare
    JEL: C93 D73 D91 I18 L38
    Date: 2019–03
  27. By: Lena Walther; Lukas M. Fuchs; Jürgen Schupp; Christian von Scheve
    Abstract: The mental health and well-being of refugees are both prerequisites for and indicators of social integration. Using data from the first wave of a representative prospective panel of refugees living in Germany, we investigated how different living conditions, especially those subject to integration policies, are associated with experienced distress and life satisfaction in newly-arrived adult refugees. In particular, we investigated how the outcome of the asylum process, family reunification, housing conditions, participation in integration and language courses, being in education or working, social interaction with the native population, and language skills are related to mental health and well-being. Our findings show that negative and pending outcomes of the asylum process and separation from family are related to higher levels of distress and lower levels of life satisfaction. Living in communal instead of private housing is also associated with greater distress and lower life satisfaction. Being employed, by contrast, is related to reduced distress. Contact to members of the host society and better host country language skills are also related to lower levels of distress and higher levels of life satisfaction. Our findings offer insights into correlates of refugees’ well-being in the first years after arrival in a host country, a dimension of integration often overlooked in existing studies, thus having the potential to inform decision-making in a highly contested policy area.
    Date: 2019
  28. By: Mochamad Pasha (Consultant, World Bank, Indonesia); Marc Rockmore (Department of Economics, Clark University); Chih Ming Tan (Department of Economics, University of North Dakota)
    Abstract: We study the effect of early life exposure to above average levels of rainfall on adult mental health. While we find no effect from pre-natal exposure, post-natal positive rainfall shocks decrease average Center for Epidemiological Studies Depression (CESD) mental health scores by 15 percent and increase the likelihood of depression by 5 percent, a more than 20 percent increase relative to the mean. These effects are limited to females. We rule out prenatal stress and income shocks as pathways and find evidence suggestive of increased exposure to disease.
    Keywords: Acute myocardial infarction, instrumental variables, mortality
    JEL: I15 O12
    Date: 2018–05
  29. By: Minhaj Mahmud; Yasuyuki Sawada; Eiji Yamada
    Abstract: This paper reports on the first attempt to measure the value of statistical life (VSL) in the context of mortality risk from air pollution in urban Bangladesh, using the contingent valuation (CV) method. The CV survey was conducted in 2013 in Dhaka and Chittagong, the two most densely populated cities in the country. We asked individuals willingness to pay (WTP) for mortality risk reduction from air quality improvement program and found that willingness to pay is correlated with the socio-economic characteristics, health status, and risk perception of the respondents, consistently with existing studies. The bootstrapped mean of VSL is ranged from 17,480-22,463 USD in purchasing power parity terms, which is equivalent to 9.78-12.57 times of GDP per capita of Bangladesh. Considering our study setting, the results we obtained may be regarded as a lower bound of VSL estimates in the context of environmental risk reductions in Bangladesh.
    Keywords: value of statistical life, willingness to pay, contingent valuation, air pollution, Bangladesh
    Date: 2019–03
  30. By: Johannes Haushofer; Anett John; Kate Orkin
    Abstract: Behavioral constraints may explain part of low demand for preventive health products. We test the effects of two light-touch psychological interventions on water chlorination and related health and economic outcomes using a randomized controlled trial among 3750 women in rural Kenya. One intervention encourages participants to visualize alternative realizations of the future; one builds participants' ability to make concrete plans to achieve goals. Both interventions include information on health benefits of chlorination. After twelve weeks, both interventions increase the share of households who chlorinate drinking water and reduce child diarrhea episodes. Analysis of mechanisms suggests both interventions increase self-efficacy – beliefs about one's ability to achieve desired outcomes – as well as the salience of chlorination. They do not differentially affect beliefs and knowledge about chlorination (compared to a group who receive only information), nor affect lab measures of time preferences or planning ability. Results suggest simple psychological interventions can increase use of preventive health technologies.
    JEL: D91 I12 O12
    Date: 2019–04
  31. By: Nina Buchmann; Erica M. Field; Rachel Glennerster; Reshmaan N. Hussam
    Abstract: The 1994 discovery of arsenic in groundwater in Bangladesh prompted a massive public health campaign that led 20% of the population to switch from backyard wells to less convenient drinking water sources that had a higher risk of fecal contamination. We find evidence of unintended health consequences by comparing mortality trends between households in the same village that did and did not have an incentive to abandon shallow tubewells. Post-campaign, households encouraged to switch water sources have 46% higher rates of child mortality than those not encouraged to switch. Switching away from arsenic-contaminated wells also increased adult mortality.
    JEL: C81 C93 O12
    Date: 2019–04
  32. By: Masuda, Kazuya; Chitundu, Maureen
    Abstract: In infants, micronutrient deficiency is known to be associated with growth faltering and morbidity. We recently reported that a 12-month intervention of home fortification of complementary foods using spirulina reduced upper respiratory infections but did not affect the linear growth of Zambian infants. The intervention, originally designed to run for 12 months, was extended by 4 months. This study aimed to evaluate whether a reduction in the morbidity seen with 12-month spirulina supplementation remained persistent after the 16-month intervention, and over the subsequent 1.5-year nonintervention period. The secondary objective was to evaluate if any differences in the growth indicator emerged long-term. We used longitudinal data from a randomized trial conducted in Luapula province, Zambia. A total of 501 infants aged 6-18 months were randomly given daily supplements of maize-soya based porridge with spirulina (SP) or without spirulina (CON). In 2016 and 2018, we collected information on the change in infants’ anthropometric status and morbidity (probable pneumonia, cough, probable malaria, and fever). The registration number of the initial clinical trial is NCT03523182 (Clinical Children in the SP group were 13% less likely to contract an upper respiratory infection after the 16-month intervention. After the 18-month nonintervention period, children in the SP group were 14% (95% CI: 2%, 25%; P
    Keywords: malnutrition, home-fortification, infant growth, morbidity, Zambia
    Date: 2019–03

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