aging and inequality in income and health in our earlier work we used data from the national health interview survey nhis to examine life cycle patterns in health status and in the joint distribution of health status and income deaton and paxson 1998 in this paper we summarize and extend those results and provide new evidence from the panel study of income dynamics psid both surveys contain a measure of household income and collect information on an ordinal measures of self reported health status srhs that ranges from 1 excellent to 5 poor section i concerns problems related to the measurement of inequality in health section ii presents evidence from the two surveys on health and income inequality this abstract was borrowed from another version of this item

longitudinal determinants of end of life wealth inequality abstract inequality in wealth among elderly households and in particular the prevalence of very low wealth holdings can be an important consideration in the design of social insurance programs this paper examines the incidence and determinants of low levels of financial and total wealth using repeated cross sections of the health and retirement study hrs and a small longitudinal sample of hrs respondents observed both at age 65 and shortly before death most of those who report very low wealth holdings at the end of their life had little wealth at the traditional retirement age of 65 there is strong persistence over time in reports of very low wealth and more generally relatively little evidence that wealth is drawn down in the first 15 years of retirement the age specific probability of reporting low wealth increases slowly after age 65 low lifetime earnings are strongly predictive of low wealth at retirement and at the end of life the post retirement onset of a major medical condition and for married women the loss of their spouse are both associated with small increases in the probability of reporting very low wealth but they account for a small fraction of low wealth outcomes low levels of wealth accumulation before age 65 rather than gaps in the safety net after 65 or rapid spend down of accumulated assets appear to be the primary determinant of low levels of wealth just before death

teen motherhood and abortion access it is argued that the net effect of any restriction of abortion access on birth rates is an empirical question this study examines the impact of access to abortion on county teenage birth rates birth rates are expected to decrease by 1 among white adolescents aged 15 19 years for a 25 mile increase in the distance to the nearest abortion provider particularly among in wedlock births data are obtained from 1973 88 national natality local area summary files for counties in the us and four other national sources data did not provide useful information on the empirical relationship between access and birth rate for densely populated urban areas cross sectional findings that had omitted variable bias indicate that an increase of 25 miles in distance to a provider was associated with an additional 1 4 births per 1000 white teenage women or a 3 increase in the average teen birth rate of 45 1000 white teenagers the findings from a county fixed effects model that controlled for omitted variable bias indicate that an increase of 25 miles was associated with a reduction in teen births of 0 5 1000 or about 1 of the mean birth rate both medicaid restrictions and parental consent laws were negative and significant and more negative in poor and more isolated counties the state year effects models did not change findings on distance and medicaid restriction effects the effects of changes in timing of laws suggests that laws followed preexisting trends changes in distance to provider were primarily in the first 2 years following the change out of wedlock births were unaffected by changes in distance to providers the out of wedlock teen birth rate increased with a complete ban on abortions fewer wanted births were associated with small restrictions findings imply that closing of clinics during 1977 88 had an impact on teen birth rates of under one tenth of 1 the 20 increase in teen births was unexplained

the effect of income on mortality evidence from the social security notch abstract legislation in the 1970s created a notch in social security payments with those born after january 1 1917 receiving sharply lower benefits using restricted use versions of the national mortality detail file combined with census data we use this quasi experiment to examine the income mortality link in an elderly population estimates from difference in difference and regression discontinuity models show the higher income group has a statistically significantly higher mortality rate contradicting the previous literature we also found that younger cohorts responded to lower incomes by increasing postretirement work effort suggesting that moderate employment has beneficial health effects for the elderly

the long term impact of military service on health evidence from world war ii and korean war veterans during the world war ii and korean war era the u s military freely distributed cigarettes to overseas personnel and provided low cost tobacco products on domestic military bases in fact even today the military continues to sell subsidized tobacco products on its bases using a variety of instrumental variables approaches to deal with nonrandom selection into the military and into smoking we provide substantial evidence that cohorts with higher military participation rates subsequently suffered more premature mortality more importantly we show that a large fraction 35 to 79 percent of the excess veteran deaths due to heart disease and lung cancer are attributable to military induced smoking

life cycle asset accumulation and allocation in canada this paper documents the life cycle patterns of household portfolios in canada and investigates several hypotheses about asset accumulation and allocation inferences are drawn from the 1999 survey of financial security with some comparisons to earlier wealth surveys from 1977 and 1984 i find cross sectional evidence for asset decumulation at older ages when annuitized assets like pension wealth are included in the analysis i also find that the portfolio share of financial assets increases sharply with age while indicators of risk tolerance appear to decrease this is consistent with families desiring more liquid and less risky assets as they age jel classification d31 e21 g11 le cycle de vie de l accumulation et de l allocation des actifs au canada ce memoire documente le cycle de vie des portefeuilles des menages au canada et examine plusieurs hypotheses quant a l allocation et l accumulation des actifs on developpe certaines inferences a partir de l enquete sur la securite financiere de 1999 ainsi qu a partir des enquetes sur la richesse de 1977 et 1984 certains resultats pointent vers une decumulation des actifs avec l avancement de l ge quand on prend en compte dans l analyse les actifs annualises comme les rentes il semble aussi que la portion des debentures augmente dramatiquement avec l ge et que les indicateurs de tolerance de risque paraissent diminuer voila qui s arrime bien a un desir d avoir des actifs plus liquides et moins risques a mesure qu on vieillit

estimating the effect of income on health and mortality using lottery prizes as an exogenous source of variation in income a vast literature has established a strong positive relation between income and health status and a negative relation with mortality this paper studies the effects of income on health and mortality using only the part of income variation due to a truly exogenous factor monetary lottery prizes of individuals the findings are that higher income causally generates good health and that this effect is of a similar magnitude as when traditional estimation techniques are used a 10 percent income increase improves health by about 4 5 percent of a standard deviation

income inequality and health status in the united states evidence from the current population survey several recent studies have identified an association between income inequality and aggregate health outcomes this has been taken to be evidence that inequality is detrimental to individual health we use data from the 1995 99 march current population survey to examine the effect of income inequality on individual health status for both the general population and those individuals in poverty we find no consistent association between income inequality and individual health status our results contradict recent claims that the psychosocial effects of income inequality have dramatic consequences for individual health outcomes

does health insurance reduce illness related worker absenteeism the objective of this article is to examine whether having health insurance reduces illness related absenteeism among older workers a nationally representative sample of 1780 workers in the united states aged 52 64 are drawn from the 2004 2006 health and retirement study hrs binary logistic regressions and censored tobit models are estimated for workers likelihood of missing work days due to illness and the number of illness related work days missed respectively while explicitly addressing the possibility of insurance selection effects the findings suggest that over a 12 month period older workers without health insurance are as likely as insured workers to miss work days due to illness and there are no differences in the number of days missed between insured and uninsured workers however there is strong evidence that poor baseline health onset of new diseases and longer hospitalization significantly increase an older worker s absenteeism at work these results suggest that having health ins

the pros and cons of spot pricing electric utility perspective abstract until recently spot pricing of electrical energy has been an academic curiosity electric utilities by and large do not vary the price of their product by time of day or cost of generation even though such costs vary considerably from peak to off peak periods the primary reason for not using spot or real time pricing has been communication and administrative costs recent advancements in technology have reduced the costs to a level where spot pricing is being considered a viable option for many utilities the remaining obstacles to be resolved are development of hardware and software to administer real time prices customer education to understand and participate in spot pricing programmes and reaching agreements with regulators on appropriate rates

determinants of healthcare spending a state level analysis within the high and rising level of healthcare spending for the us as a whole is substantial variation in spending across states yet relatively little attention has been given to the empirical analysis of interstate differences in aggregate healthcare expenditures and therefore little empirical evidence exists at the state level to guide policymakers using data for all 50 states for the year 1998 we estimate an empirical model that includes structural and reduced form healthcare spending equations and a health production function to assess the significance size and relative importance of factors that prior research indicates may play an important role in explaining interstate variation in medical care expenditures and the main pathways through which they operate our results indicate higher levels of healthcare spending for state populations with higher income less education fewer uninsured residents less healthy lifestyles larger proportion of elderly residents greater availability of medical

the dynamics of health in the british household panel survey this paper considers the dynamics of a categorical indicator of self assessed health using eight waves 1991 1998 of the british household panel survey bhps our analysis has three focal points the relative contributions of state dependence and heterogeneity in explaining the dynamics of health the existence and consequences of health related sample attrition and the investigation of the effects of measures of socioeconomic status with a particular focus on educational attainment and income to investigate these issues we use dynamic panel ordered probit models there is clear evidence of health related attrition in the data but this does not distort the estimates of state dependence and of the socioeconomic gradient in health the models show strong positive state dependence and heterogeneity accounts for around 30 of the unexplained variation in health copyright 2004 john wiley sons ltd

the relationship between economic status and child health evidence from the united states the positive relationship between socioeconomic status ses and health e g mortality and morbidity often called the gradient is well known in the social sciences an issue of contro versy about this relationship is the direction of causality does ses affect health or health affect ses anne case darren lubotsky and christina paxson 2002 examined the effect of income on the health status of children since children in developed countries are unlikely to work the relationship between income and health status is unidirectional from income to health status not only do case lubotsky and paxson hereafter clp find a positive relationship between health and income but they also find that the income gradient becomes steeper as children age the steepening gradient implies the negative effects of low family incomes on children s health become larger as a child ages with the harmful effects of low income on a child s health likely to accumulate over the child s lifetime janet currie and mark stabile 2003 highlight two limitations associated with using crosssection data as were used by clp when trying to explain the possible mechanisms underlying the relationship between ses and health first children from low ses households may be less able to recover from a particular health shock and as a result the negative effects of each shock are likely to accumulate over time second low ses children may respond to a particular shock in the same way as high ses children but are subjected to more health shocks as they age identifying which of these two mechanisms is dominant is critical for policy under the first mechanism policy would be directed at improving the access to and or quality of medical care for low ses children so they are able to respond to shocks in the same way as high ses children on the other hand if the second mechanism is dominant and low ses children respond to health shocks in the same way as high ses children social funds should be directed toward programs that reduce the arrival rate of new health shocks using data from a panel of canadian children for the period 1994 to 1998 currie and stabile cs found that given a chronic condition in 1994 low ses children were no more likely than high ses children to be in poor health in 1998 the lack of an ses differential response to a given shock after four years suggests the first mechanism above is not the cause of the increasing strength of the gradient as canadian children get older an important finding by cs is that lowses canadian children are subject to more shocks as they age thereby suggesting the impor tance of the second explanation of the strengthening of the ses health relationship 1

the impact of divorce laws on marriage specific capital this article considers how divorce law alters the incentives for couples to invest in their marriage focusing on the impact of unilateral divorce laws on investments in new marriages differences across states between 1970 and 1980 provide useful quasi experimental variation with which to consider incentives to invest in several types of marriagespecific capital spouse s education children household specialization and home ownership i find that adoption of unilateral divorce regardless of the prevailing property division laws reduces investment in all types of marriage specific capital considered except home ownership in contrast results for home ownership depend on the underlying property division laws

uncertain medical expenses and precautionary saving near the end of the life cycle this paper introduces a dynamic structural model of household consumption decisions in which elderly families consider the effects of uncertain future medical expenses when deciding current levels of consumption the model with uncertain medical expenses implies a potentially important role for precautionary saving incentives to explain slow rates of dissaving among elderly americans during retirement rather than just simulating the stochastic dynamic model preference parameters are estimated using panel data on health wealth and expenditures for retired families the health uncertainty model predicts consumption levels closer to observed expenditures than a life cycle model with uncertain longevity however elderly families typically dissave their financial assets more slowly than even the baseline health uncertainty model predicts is optimal

a model of longevity fertility and growth abstract economic and demographic outcomes are determined jointly in a dynamic general equilibrium model of longevity fertility and growth reproductive agents in overlapping generations mature safely through two periods of life and face an endogenous probability of surviving for a third period given this probability each agent maximises her expected lifetime utility by choosing consumption and the number of children child bearing is costly in the sense that time must be spent on child rearing activities rather than on production or education the model produces multiple development regimes which yield different predictions about life expectancy fertility timing of births and educational investment depending on initial conditions these predictions accord strongly with the empirical evidence on demography and development

inter vivos transfers and bequests in three oecd countries reforms reducing the generosity of pensions have distributional effects on future generations if individuals care about their descendants welfare but only affect elderly individuals if bequests are the unintentional result of precautionary savings and safety net programmes such as unemployment insurance may displace sources of private help such as that provided by living parents to their children in need this paper provides comparable measures of how expected bequests and transfers vary with cumulated parental earnings in the united states west germany and the united kingdom the strength of bequest motives is empirically very weak in the available data private inter vivos transfers which appear to depend on the recipients economic situation are partly crowded out by public unemployment insurance programmes together involuntary bequests and intentional inter vivos transfers appear to be an important channel of intergenerational inequality transmission and strengthen substantially the relationship between an individual s and his parents economic status ernesto villanueva

income related inequality in life years and quality adjusted life years abstract we estimate the income related inequality in sweden with respect to life years and quality adjusted life years qalys we use a large data set from sweden with over 40 000 individuals followed up for 10 16 years to estimate the survival and quality adjusted survival in different income groups for both life years and qalys we discover inequalities in health favouring the higher income groups for men women in the youngest age group 20 29 years the number of qalys is 43 7 45 7 in the lowest income decile and 47 2 49 0 in the highest income decile

the effect of pensions on longevity evidence from union army veterans this study uses changes in pension laws for union army veterans as a natural experiment to estimate the causal effect of pensions on longevity and to examine potential pathways underlying such a relationship we examine the effects of the pension laws of 1907 and 1912 which granted old age pensions to union army veterans life expectancy for veterans who received such a pension increased by 0 5 years and 2 7 years respectively the effect of veteran pensions on longevity was large across wealth groups and size of city pensions reduced mortality for both acute and non acute causes of death

the determinants of mortality mortality rates have fallen dramatically over time starting in a few countries in the 18th century and continuing to fall today in just the past century life expectancy has increased by over 30 years at the same time mortality rates remain much higher in poor countries with a difference in life expectancy between rich and poor countries of also about 30 years this difference persists despite the remarkable progress in health improvement in the last half century at least until the hiv aids pandemic in both the time series and the cross section data there is a strong correlation between income per capita and mortality rates a correlation that also exists within countries where richer better educated people live longer we review the determinants of these patterns over history over countries and across groups within countries while there is no consensus about the causal mechanisms we tentatively identify the application of scientific advance and technical progress some of which is induced by income and facilitated by education as the ultimate determinant of health such an explanation allows a consistent interpretation of the historical cross country and within country evidence we downplay direct causal mechanisms running from income to health

cognitive abilities and portfolio choice we study the relation between cognitive abilities and stockholding using the recent survey of health ageing and retirement in europe share which has detailed data on wealth and portfolio composition of individuals aged 50 in 11 european countries and three indicators of cognitive abilities mathematical verbal fluency and recall skills we find that the propensity to invest in stocks is strongly associated with cognitive abilities for both direct stock market participation and indirect participation through mutual funds and retirement accounts since the decision to invest in less information intensive assets such as bonds is less strongly related to cognitive abilities we conclude that the association between cognitive abilities and stockholding is driven by information constraints rather than by features of preferences or psychological traits

the insurance value of medical innovation abstract economists think of medical innovation as a valuable but risky good producing health benefits but increasing financial risk for consumers and healthcare payers this perspective overlooks how innovation can lower physical risks borne by healthy patients facing the prospect of future disease we present an alternative framework that accounts for all these sources of value and links them to the value of healthcare insurance we show that any innovation worth buying reduces overall risk and generates positive insurance value on its own we conduct a stylized numerical exercise to assess the potential empirical significance of our insights our calculations suggest that conventional methods meaningfully understate the value of historical health gains and disproportionately undervalue treatments for the most severe illnesses where physical risk to consumers is the costliest these calculations also suggest that the value of physical insurance from new technologies may exceed the financial spending risk that they pose

still waiting for mister right asymmetric information abortion laws and the timing of marriage previous studies have suggested that more liberal abortion laws should lead to a decrease in marriage rates among young women as shotgun weddings are no longer necessary empirical evidence from the united states lends support to that hypothesis this article presents an alternative theory of abortion access and marriage based on the cost of search which suggests that more liberal abortion laws may actually promote young marriage an empirical examination of marriage data from eastern europe shows that countries that liberalized their abortion laws saw an increase in marriage rates among nonteenage women

worker absence and productivity evidence from teaching a significant amount of work time is lost each year due to worker absence but evidence on the productivity losses from absenteeism remains scant due to difficulties with identification we use uniquely detailed data on the timing duration and cause of absences among teachers to address many of the potential biases from the endogeneity of worker absence our analysis indicates that worker absences have large negative impacts the expected loss in daily productivity from employing a temporary substitute is on par with replacing a regular worker of average productivity with one at the 10th 20th percentile of productivity

mortality health status and wealth in this paper we use the two waves of the british retirement survey 1988 1989 and 1994 to quantify the relationship between socioeconomic status and health outcomes we find that even after conditioning on the initial health status wealth rankings are important determinants of mortality and the evolution of the health indicator in the survey for men aged 65 moving from the 40th percentile to the 60th percentile in the wealth distribution increases the probability of survival by between 1 0 and 1 9 percentage points depending on the measure of wealth used a similar effect is found for women of between 1 1 and 1 3 percentage points in the process of estimating these effects we control for nonrandom attrition from our sample

differential mortality and wealth accumulation the issue of asset accumulation and decumulation is central to the life cycle theory of consumer behavior and to many policy questions one of the main implications of the life cycle model is that assets are decumulated in the last part of life most empirical studies in this area use cross sectional data of estimate mean or median wealth age profiles the use of cross sections to estimate the age profile of assets is full of pitfalls for example if wealth and mortality are related in that poorer individuals die younger one overestimates the last part of the wealth age profile when using cross sectional data because means or other measures of location are taken over a population which becomes richer as it ages this paper examines the effect of differential mortality on cross sectional estimates of wealth age profiles our approach is to quantify the dependence of mortality rates on wealth and use these estimates to correct wealth age profiles for sample selection due to differential mortality we estimate mortality rates as a function of wealth and age for a sample of married couples drawn from the survey of income and program participation sipp our results show that accounting for differential mortality produces wealth profiles with significantly more dissaving among the elderly

a median voter model of health insurance with ex post moral hazard abstract one of the main features of health insurance is moral hazard as defined by pauly pauly m v 1968 the economics of moral hazard comment american economic review 58 531 537 people face incentives for excess utilization of medical care since they do not pay the full marginal cost for provision to mitigate the moral hazard problem a coinsurance can be included in the insurance contract but health insurance is often publicly provided having a uniform coinsurance rate determined in a political process is quite different from having different rates varying in accordance with one s preferences as is possible with private insurance we construct a political economy model in order to characterize the political equilibrium and answer questions like under what conditions is there a conflict in society on what coinsurance rate should be set and which groups of individuals will vote for a higher and lower than equilibrium coinsurance rate respectively we also extend our basic model and allow people to supplement the coverage provided by the government with private insurance then we answer two questions who will buy the additional coverage and how do the coinsurance rates people are now faced with compare with the rates chosen with pure private provision

public private mix of health expenditure a political economy and quantitative analysis this paper constructs a simple model to examine decisions on public and private health spending under majority voting in the model agents with heterogeneous incomes choose how much to consume and spend on health care and vote for public health expenditure the health status of an agent is determined by a ces composite of public and private health expenditure the existence and uniqueness of the voting equilibrium are established a quantitative exercise reveals the importance of the relative effectiveness of public and private health expenditure and their substitutability in determining the public private mix of health expenditure and in accounting for the observed differences across a sample of 22 advanced democratic countries

average earnings and long term mortality evidence from administrative data in this paper we exploit a unique database that merges longitudinal earnings data on pennsylvanian workers with national death records to study the detailed nature of the corre lation between earnings and mortality we find that the estimates typically reported in the lit erature which are based on single years of earn ings data are likely to understate substantially the strength of the association between income and mortality in particular relative to a single year of earnings the average of earnings over a six year period predicts a 70 percent greater impact of income on mortality in addition con trolling for the mean level of earnings over a period we find that greater earnings volatility is associated with higher mortality we also examine the lag structure of the rela tionship between earnings and mortality we

socioeconomic inequality of access to healthcare does choice explain the gradient equity of access is a key policy objective in publicly funded healthcare systems however observed inequalities of access by socioeconomic status may result from differences in patients choices using data on non emergency coronary revascularisation procedures in the english national health service we found substantive differences in waiting times within public hospitals between patients with different socioeconomic status up to 35 difference or 43 days between the most and least deprived population quintile groups using selection models with differential distances as identification variables we estimated that only up to 12 of these waiting time inequalities can be attributed to patients choices of hospital and type of treatment heart bypass versus stent residual inequality after allowing for choice was economically significant patients in the least deprived quintile group benefited from shorter waiting times and the associated health benefits were worth up to 850 per person

who marries whom and why this paper proposes and estimates a static transferable utility model of the marriage market the model generates a nonparametric marriage matching function with spillover effects it rationalizes the standard interpretation of marriage rate regressions and points out its limitations the model was used to estimate u s marital behavior in 1971 72 and 1981 82 the marriage matching function estimates show that the gains to marriage for young adults fell substantially over the decade unlike contradictory marriage rate regression results the marriage matching function estimates showed that the legalization of abortion had a significant quantitative impact on the fall in the gains to marriage for young men and women

do the sick retire early chronic illness asset accumulation and early retirement our objective is to determine how chronic illness affects asset accumulation and retirement previous studies have found that poor health leads to early retirement but those studies failed to look at the indirect impact of chronic illness on retirement using data from the health and retirement study we define an illness as chronic if the individual reports having asthma cancer heart disease stroke or diabetes for four or more years we first estimate how a chronic illness influences asset accumulation we then estimate how asset accumulation and current poor health influence retirement we observe that the vast majority of the chronically ill population do not report their general health to be poor nor do they report functional limitations in activities of daily living nevertheless our results indicate that chronic illness leads these people to accumulate fewer assets during their working years and consequently retire later neither researchers nor policy makers discussing the many critical issues

the changing dis utility of work we study how changes in the distribution of occupations have affected the aggregate non pecuniary costs and benefits of working the physical toll of work is less now than in 1950 with workers shifting away from occupations in which people report experiencing tiredness and pain the emotional consequences of the changing occupation distribution vary substantially across demographic groups work has become happier and more meaningful for women but more stressful and less meaningful for men these changes appear to be concentrated at lower education levels

causal effects of health shocks on consumption and debt quasi experimental evidence from bus accident injuries abstract endogeneity between health and wealth presents a challenge for estimating causal effects of health shocks using a quasi experimental design comprising exogenous shocks sustained as bus accident injuries in india with controls drawn from travelers on the same bus routes one year later i present new evidence of causal effects on consumption and debt using primary household survey data i find that households faced with shock related expenditures are able to smooth consumption on food housing and festivals with small reductions in educational spending debt was the principal mitigating mechanism households used leading to significantly larger levels of indebtedness

an analysis of out of wedlock childbearing in the united states this paper relates the erosion of the custom of shotgun marriage to the legalization of abortion and the increased availability of contraception to unmarried women in the united states the decline in shotgun marriage accounts for a significant fraction of the increase in out of wedlock first births several models illustrate the analogy between women who do not adopt either birth control or abortion and the hand loom weavers both victims of changing technology mechanisms causing female immiseration are modeled and historically described this technology shock hypothesis is an alternative to welfare and job shortage theories of the feminization of poverty excerpt

the evolution of medical spending risk how has the economic risk of health spending changed over time for u s households we describe trends in aggregate health spending in the united states and how private insurance markets and public insurance programs have changed over time we then present evidence from consumer expenditure survey microdata on how the distribution of household spending on health that is out of pocket payments for medical care plus the household s share of health insurance premiums has changed over time this distribution has shifted up over time households spend more on medical care and insurance than they used to but for the purposes of measuring change in risk it is not the mean but the dispersion of this distribution that is of interest we consider two measures of dispersion that serve as proxies for household risk the standard deviation of the distribution of household health spending and the ratio of the 90th percentile of spending to the median the so called 90 50 gap we find surprisingly that neither has increased despite the rapid rise in aggregate health spending this conclusion holds true for broad subgroups of the population for example the nonelderly as a group but not for some narrowly defined subgroups for example low income families with children we next consider how much risk households should face from the perspective of economic efficiency household risk may not have changed much over the past several decades but do we have any evidence that this level represents either too much or too little risk finally we discuss implications for public policy in particular for current debates over expanding health insurance coverage to the uninsured

political complements in the welfare state health care and social security abstract all oecd countries target a large majority of their welfare spending to the elderly through public pensions and health care programs spending in both programs has largely increased in the past decades often more than the share of elderly in the population we suggest that these phenomena may be due to political complementarities between these two transfer programs we show that these two programs may coexist because public health care may increase the political constituency in favor of social security and vice versa specifically public health decreases the absolute longevity differential between low and high income individuals therefore rising the retirement period and the total pension benefits of the former relatively to the latter this effect increases the political support for social security among the low income young we show that in a political equilibrium of a two dimensional majoritarian election a voting majority of low income young and retirees supports a large welfare state the composition between public health and social security is determined by intermediate median income types who favor the contemporaneous existence of these two programs since public health increases their longevity enough to make social security more attractive technological improvements in health care strengthens this complementarity and lead to more welfare spending

wealth health and child development evidence from administrative data on swedish lottery players we use administrative data on swedish lottery players to estimate the causal impact of substantial wealth shocks on players own health and their children s health and developmental outcomes our estimation sample is large virtually free of attrition and allows us to control for the factors conditional on which the prizes were randomly assigned in adults we find no evidence that wealth impacts mortality or health care utilization with the possible exception of a small reduction in the consumption of mental health drugs our estimates allow us to rule out effects on 10 year mortality one sixth as large as the crosssectional wealth mortality gradient in our intergenerational analyses we find that wealth increases children s health care utilization in the years following the lottery and may also reduce obesity risk the effects on most other child outcomes including drug consumption scholastic performance and skills can usually be bounded to a tight interval around zero overall our findings suggest that in affluent countries with extensive social safety nets causal effects of wealth are not a major source of the wealth mortality gradients nor of the observed relationships between child developmental outcomes and household income jel codes i10 i14 j24

women insurance capital and economic development in rural india in this paper longitudinal data from a national probability sample of rural households in india are used to assess how the traditional migration of women across households via marriage by contributing to consumption smoothing augments the returns to women as human capital and how these returns are affected by economic development propelled by agricultural technical progress the estimates confirm earlier findings based on more geographically confined data from india that interhousehold financial transfers play a small but significant role in contributing to consumption smoothing such transfers appear to be more responsive to a households fluctuations in earnings that are loans and this responsiveness is significantly augmented in households with more informal connections to other households that arise due to the marriages of sons who stay in the parental household and daughters who migrate the estimates also suggest that technical change presumably because of its impact on the returns to experience on earnings levels and on risk assessment represents a threat to the traditional household and in particular to marriage based risk pooling the results indicate that the transformation of traditional agriculture through technological change thus extends beyond agricultural practices to the relationships among households and also within households and does not necessarily lead to great equality by sex in the intrahousehold distribution of resources despite the evident normality of equality in intrahousehold resources authors

health and other asset holdings despite clear evidence of correlations between financial and medical statuses and decisions most models treat financial and health related choices separately this article bridges this gap by proposing a tractable dynamic framework for the joint determination of optimal consumption portfolio holdings health investment and health insurance we solve for the optimal rules in closed form and capitalize on this tractability to gain a better understanding of the conditions under which separation between financial and health related decisions is sensible and of the pathways through which wealth and health determine allocations welfare and other variables of interest such as expected longevity or the value of health furthermore we show that the model is consistent with the observed patterns of individual allocations and provide realistic estimates of the parameters that confirm the relevance of all the main characteristics of the model

inequality aversion in income health and income related health abstract based on a survey of a sample of the general public we estimate inequality aversion across income health and bivariate income health inequality aversion is domain specific mean inequality aversion is greater for income than for health but the underlying distributions of aversion attitudes differ with a highly bi modal distribution of inequality aversion values for health in which nearly half the participants display very low aversion and nearly half display very high aversion aversion to income related health inequality is greater than that to income or health alone consistent with previous literature we find only weak associations between aversion attitudes and individual characteristics the magnitude of the estimates implies potentially large gains in welfare from reducing inequality in these domains

birth control and female empowerment an equilibrium analysis we analyze from a theoretical perspective the impact of innovations in birth control technology on intrahousehold allocation of resources we consider a model of frictionless matching on the marriage market in which men as well as women differ in their preferences for children moreover men unlike women must marry to enjoy fatherhood we show that more efficient birth control technologies generally increase the power hence the welfare of all women including those who do not use them this empowerment effect requires that the new technology be available to single women an innovation reserved to married women may result in a disempowerment effect

healthy bodies and thick wallets the dual relation between health and economic status there is abundant evidence of a quantitatively large association between many measures of economic status including income and wealth and a variety of health outcomes such as mortality or morbidity however considerable and often heated debate remains especially across disciplines about the direction of causation and about why the association arises although medical scientists are often convinced that the dominant if not exclusive pathway is that variation in socioeconomic status produces health disparities they are increasingly debating among themselves about why low economic status might lead to poor health at least for modern industrial countries 1 the old standby arguments the less well to do have access to less or lower quality medical care or a stronger pattern of deleterious personal behaviors have been rejected as insufficient instead a series of intriguing competing theories have arisen that emphasize long term impacts of early childhood or even inter uterine environmental factors the cumulative effects of prolonged exposures to individual stressful events or reactions to macro societal factors such as rising levels of income inequality a common link is that each theory attempts to document the physiological processes through which low economic status leads to poorer health while these scientific questions are extremely important this research has taken place with little input from economists economists are now making contributions about the alternative pathway the impact poor health may have on economic resources poor health may restrict a family s capacity to earn income or to accumulate assets by limiting work or by raising medical expenses at a minimum this work should provide a caution against exaggerating the magnitude of causation from economic status to health outcomes but the potential contribution runs deeper as people age the evolving variation in individual health outcomes may offer additional statistical information to estimate parameters of household savings and consumption behavior that so far have proven to be somewhat elusive thus incorporating health uncertainty and risk into economic models should eventually enrich our understanding of basic tenets of household behavior the first section of this paper documents the size of the association between health and one prominent economic status measure household wealth section two deals with how health influences economic status by sketching out reasons why health may alter household savings and eventually wealth and then providing estimates of the empirical magnitude of these effects section three shifts attention to the alternative pathway the links between economic status and health and summarizes 2major controversies and evidence surrounding these issues

information technology and efficient pricing providing a competitive edge for electric utilities abstract electricity has traditionally been generated and sold as a homogeneous commodity with a single price this practice has less to do with the nature of electricity than with the lack of technology to distinguish among each kilwatthour based on what and when it is used this article argues that with the recent advances in information and communication technologies the time has arrived to market electricity as something other than a homogeneous commodity by pricing electricity according to its time of use for example electricity will be more efficiently utilized benefitting both the customers and the electric companies

life expectancy and old age savings rich people women and healthy people live much longer than their poor male and sick counterparts two extremes taken from our analysis of single people in the assets and health dynamics of the oldest old ahead dataset illustrate this point an unhealthy 70 year old male at the twentieth percentile of the permanent income distribution expects to live only 6 more years that is to age 76 in contrast a healthy 70 year old woman at the eightieth percentile of the permanent income distribution expects to live 16 more years thus making it to age 86 such significant differences in life expectancy could all else equal lead to significant differ ences in saving behavior a related observation is that people with high permanent incomes keep large amounts of assets until very late in life table 1 also based on the

customer preferences for reliable power supply using data on actual choices of back up equipment this paper empirically examines customer preferences for the reliable sources of electricity using data obtained from a survey of back up systems owned by large computer users in japan the empirical results based on probabilistic discrete choice models indicate that 1 customers face a trade off between the price and the reliability of the power supply and 2 customer characteristics such as types of business and levels of electricity usage have significant impacts on the choice of back up apparatuses the estimates of cost changes that would offset reliability changes imply that the financial and communications sectors are more concerned about reliability than are other sectors copyright 1994 by mit press

uncertain health and survival effects on end of life consumption this article analyzes the impact of health and survival uncertainty on the saving and consumption decisions of retirees a dynamic programming approach is used to model the household s planning problem the utility parameters are estimated using panel data we find that a fall into poor health raises the marginal utility from consumption simulations are used to indicate the effects of falling into poor health and loss of spouse they reveal a large transfer from the healthy to the sick partner and a strong dependence of saving on the survivor benefits suggesting that concern about the surviving spouse is an important motive for saving

income productivity in china on the role of health this study provides empirical evidence regarding the income productivity of health human capital in china we appeal to concepts from human capital theory to support a basic model that treats health as a form of human capital in the income production process our model examines the economic return at the household level from the health of its individual members we estimate this with a longitudinal sample drawn from the china health and nutrition survey chns allowing us to exploit within variation in health and income to address possible unobservables biasing estimates of the impact of health on income in the simple cross sectional setting household income is strongly influenced by the health of its members particularly in rural areas these findings could have important implications for health and economic policy making aimed at reducing the long standing urban rural economic gap and more comprehensively insuring the rural population against health and economic risk

health status and portfolio choice causality or heterogeneity abstract this paper explores the role of unobserved individual characteristics in the health assets and health portfolio correlations we apply various econometrics models to a unique longitudinal dataset with rich information that allows for the exploitation of four different health indices our findings show strong cross sectional correlations between health and both financial and non financial assets but these correlations seem to be mainly driven by heterogeneity as the correlations largely disappear in the fixed effects model adverse health shocks however are found to motivate a safer portfolio choice even after individual fixed effects are controlled for a result consistent with the prediction made by the background risk theory our findings suggest that health shocks shift investment from risky assets toward other financial assets but keep the total financial assets unchanged

inheritances intergenerational transfers and the accumulation of health research on inheritances has largely focused on the motives of the bequeathing regardless of the motivations of the giving generation prior to death wealth is transferred and this additional money may have an impact on the receiving generation in particular inheritances may be correlated with individuals health for several reasons first there may be a causal effect inheritances provide additional financial resources allowing recipients to purchase inputs to health and health care a large literature on socioeconomic status ses and health investigates the effect of financial resources on health second inheritances may signal the overall strength of a dynasty this dynastic strength would manifest itself in both better health and more ability to leave a bequest inheritances could be associated with better health because parents who will eventually bequeath wealth to their children may have disproportionately higher ses which improves the health outcomes of the children third bequests and a bequest motive may signal a stronger interest in one s child this reminder to the child could improve his emotional well being this paper

how social security and medicare affect retirement behavior in a world of incomplete markets this paper provides an empirical analysis of how the u s social security and medicare insurance system affect the labor supply of older males in the presence of incomplete markets for loans annuities and health insurance we estimate a detailed dynamic programming dp model of the joint labor supply and social security acceptance decision focusing on a sample of males in the low to middle income brackets whose only pension is social security the dp model delivers a rich set of predictions about the dynamics of retirement behavior and comparisons of actual vs predicted behavior show that the dp model is able to account for wide variety of phenomena observed in the data including the pronounced peaks in the distribution of retirement ages at 62 and 65 the ages of early and normal eligibility for social security benefits respectively we identify a significant fraction of health insurance constrained individuals who have no form of retiree health insurance other than medicare and who can only obtain fairly priced private health insurance via their employer s group health plan the combination of significant individual risk aversion and a long tailed pareto distribution of health care expenditures implies that there is a significant security value for these individuals to remain employed until they are eligible for medicare coverage at age 65 overall our model suggests that a number of heretofore puzzling aspects of retirement behavior can be viewed as artifacts of particular details of the social security rules whose incentive effects are especially strong for lower income individuals and those who do not have access to fairly priced loans annuities and health insurance

the unobserved pattern of material hardship and health among older americans this paper investigates the relationship between self reported health and material hardship among older americans differently from income based measures material hardship provides a more specific description of the concrete adversities faced by the elderly we have used the last six waves of the health and retirement study to explore the relative contributions of state dependence unobserved heterogeneity and time specific shocks on reporting poor health experiencing food insecurity and medication cutbacks we have used a latent markov model to estimate a multivariate non linear system of equations for panel data allowing time varying unobserved heterogeneity our results reveal a high state dependence of both health and material hardship conditions estimated trajectories reveal that pathways of material hardship are associated differently with health material hardship is also spread across its dimensions

the impact of legalized abortion on crime we offer evidence that legalized abortion has contributed significantly to recent crime reductions crime began to fall roughly eighteen years after abortion legalization the five states that allowed abortion in 1970 experienced declines earlier than the rest of the nation which legalized in 1973 with roe v wade states with high abortion rates in the 1970s and 1980s experienced greater crime reductions in the 1990s in high abortion states only arrests of those born after abortion legalization fall relative to low abortion states legalized abortion appears to account for as much as 50 percent of the recent drop in crime

the dynamics of food insecurity and overall health evidence from the canadian national population health survey the paper explores whether the responses to household food insecurity questions in cycles two and three of the canadian national population health survey help explain the links between socioeconomic status and health at the individual level short term transitions in food insecurity status are correlated with changes in health status there is some evidence for females but not for males that conditional on current health current household food insecurity can lead to lower future health status even in the short run there is stronger evidence for both males and females that conditional on current household food insecurity status lower current health status can lead to an increased probability of future household food insecurity