Ture or False? Why? Chay and Greenstone (2003a) use cross-county differences in changes in pollution induced by the 1981-82 recession to estimate the effect of air pollution on infant mortality. If counties with big pollution declines also experience dramatic drops in population (because households move to counties with better economic opportunities), relative to counties without pollution declines, this could generate bias in their estimates

Ture or False? Why? Chay and Greenstone (2003a) use cross-county differences in changes in pollution induced by the 1981-82 recession to estimate the effect of air pollution on infant mortality. If counties with big pollution declines also experience dramatic drops in population (because households move to counties with better economic opportunities), relative to counties without pollution declines, this could generate bias in their estimates

EBK HEALTH ECONOMICS AND POLICY

7th Edition

ISBN:9781337668279

Author:Henderson

Publisher:Henderson

Chapter4: Economic Evaluation In Health Care

Section: Chapter Questions

Problem 2QAP

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The government would like to introduce a subsidy to help citizens who need their car for work and cannot afford to buy a ULEZ-compliant car. It also wants to ensure that only citizens who need to drive their car regularly use the subsidy. Instead of the two groups of citizens discussed above, we focus on one particular citizen who does not drive very often, only once a year. As a result, this citizen does not emit excessive pollution even with a car that is not ULEZ-compliant. The government would therefore prefer citizens like her not to buy a new car to avoid having to pay the subsidy unnecessarily. Once a year, the citizen derives a benefit of driving through the ULEZ area of B = 20. She can choose to either buy a new ULEZ-compliant car at a cost of C = 10, 000, denoted x = new, or stick with her old car at no cost, denoted x = old.If she sticks with her old car, she has to pay a ULEZ fee of τ = 12.50 on the day that she drives. Her net benefit of driving on that day is therefore…
The government would like to introduce a subsidy to help citizens who need their car for work and cannot afford to buy a ULEZ-compliant car. It also wants to ensure that only citizens who need to drive their car regularly use the subsidy. Instead of the two groups of citizens discussed above, we focus on one particular citizen who does not drive very often, only once a year. As a result, this citizen does not emit excessive pollution even with a car that is not ULEZ-compliant. The government would therefore prefer citizens like her not to buy a new car to avoid having to pay the subsidy unnecessarily. Once a year, the citizen derives a benefit of driving through the ULEZ area of B = 20. She can choose to either buy a new ULEZ-compliant car at a cost of C = 10, 000, denoted x = new, or stick with her old car at no cost, denoted x = old.If she sticks with her old car, she has to pay a ULEZ fee of t = 12.50 on the day that she drives. Her net benefit of driving on that day is therefore…
The government would like to introduce a subsidy to help citizens who need their car for work and cannot afford to buy a ULEZ-compliant car. It also wants to ensure that only citizens who need to drive their car regularly use the subsidy. Instead of the two groups of citizens discussed above, we focus on one particular citizen who does not drive very often, only once a year. As a result, this citizen does not emit excessive pollution even with a car that is not ULEZ-compliant. The government would therefore prefer citizens like her not to buy a new car to avoid having to pay the subsidy unnecessarily. Once a year, the citizen derives a benefit of driving through the ULEZ area of B = 20. She can choose to either buy a new ULEZ-compliant car at a cost of C = 10, 000, denoted x = new, or stick with her old car at no cost, denoted x = old. 5 If she sticks with her old car, she has to pay a ULEZ fee of τ = 12.50 on the day that she drives. Her net benefit of driving on that day is…
Suppose there are two polluters in the same region. The government decides that total market abatement of pollution (AMKT) should be set at 46 units/year, which would significantly reduce pollution. The polluters' marginal abatement costs (MAC) and total abatement costs (TAC) are: Polluter 1: MAC, = 2.3*A, and TAC, = 1.15*(A,)? Polluter 2: MAC2 = 0.6*Az and TAC2 = 0.3"(A2)? To reach the target of 46 units/year, the government has to decide whether to use a Pigouvian tax or a uniform standard. How much would be saved in abatement costs if a Pigouvian tax were used instead of a uniform standard? Answer:
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An article in JAMA by Mandelblatt et al (2002) compared the societal costs and benefits of human papillomavirus (HPV) testing, Pap testing, and their combination to screen for cervical cancer. The paper studied 18 different population screening strategies – Pap testing alone, HPV testing alone, and Pap plus HPV testing – every 2 or 3 years for women beginning at age 20 and continuing to 65 years, 75 years, and death. The following table summarizes some of the results (low cost to high cost). Costs include screening and treatment costs, discounted over the individual’s expected lifetime. Strategy Cost ($) QALYs Saved Incremental Cost Incremental QALY ICER* 0. No screening 5,000 26.87 1. Pap every 3 years to age 75 6,825 27.02 2. HPV every 3 years to age 75 6,950 27.02 3. Pap every 2 years to age 75 7,275 27.04 4. Pap + HPV every 3 years to age 75 7,400 27.04 5. HPV every 2 years to age 75 7,450…
What is the term for a measure of Public Health directly related to the value of human life and the economic implications of the loss of individuals in a society
The market inverse supply curve for amoxicillin, an antibiotic with lots of generics, isrepresented by the equation P = 3 + 0.0006QS. The market demand curve is represented byQD = 187,500 − 625P.It is well known that antibiotic use generates negative externalities. How might thegovernment restrict the use of antibiotics? Show this on a demand-supply graph. Thendiscuss a potential unintended consequence of the government’s intervention.
The government has recently introduced a marketable permit program for major polluters where one permit gives permission to pollute one unit. When the program is introduced, Firm A emits 400 units of pollutant and so is granted 400 permits. After one year, firms are issued 25% fewer pollution permits. If Firm A reduces its pollutants from 400 units to 260 units, how many permits does it sell after one year?
It is discovered that production of painclear damages groundwater quality – this affects just one party: Greenview Nature Park (a park run by the local council which people can access, for free, for recreation). The value of the damage caused is £48 per litre of paint produced – so the pollution damage caused when output is 1 litre=£48, the 2 nd litre causes another £48 of damage, so pollution damage caused when output is 2 litres=£96. This damage happens and is the same whenever XY produces, whatever the level of output (same if it produces 1 litre of or 1 000 000 litres of painclear - each additional litre imposes an additional £48 of pollution costs). The drug has no side effects on consumers. (the clarifying information in red was added on 21/12/23) 1.Create and explain a new diagram which shows relevant costs, price and levels of output if XY produced the optimal quantity of painclear from a societal perspective. 2. Assume XY and Greenview can negotiate. Create and explain 2 new…
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Suppose Homer and Smithers are in the same health insurance pool and they pay the same premium for their health insurance. Suppose further, that the SNPP discriminates against employees on the basis of body weight so that a negative wage penalty is associated with obesity. Finally, suppose Homer eschews exercise and loves jelly donuts much more than Smithers does. As a result, Homer also has much higher expected medical expenditures. Does Homer impose a negative externality on Smithers? Explain why or why not, and describe carefully any assumptions you need to answer this question.