Health Economics
14th Edition
ISBN: 9781137029966
Author: Jay Bhattacharya
Publisher: SPRINGER NATURE CUSTOMER SERVICE
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Chapter 4, Problem 8E
To determine
Determine whether the given statement is true or false.
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Indicate whether each statement is true or false, and justify your answer.The goal of health policy is to maximize health, wealth, and equity.
Indicate whether the statement is true or false, and justify your answer.People who drop out of high school are able to produce more health than college graduates because they have more free time to invest in health production.
Indicate whether the statement is true or false, and justify your answer.There is a consensus among health economists that socioeconomic status has a major impact on health, but health does not have a significant effect on SES.
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- Which of the following hypotheses argues that a third variable, "patient", determines both health and wealth: Fuchs hypothesis efficient producer hypothesis thrifty phenotype hypothesis allostatic load hypothesis access to care hypothesisarrow_forwardSuppose that in the fictional country ASU in 2012, a mandate was passed where everyone between the ages of 23-25 will receive health insurance at a discounted rate, while individuals aged 27-29 were not impacted by this policy. You, a researcher, want to study the effect of offering discounted health insurance coverage on the use of mental health services. You have data on the average number of visits for these two age groups over time. Using the information in the table below, a quick difference-in-difference calculation suggests that the mandate led to Time Periods Age group Avg. Avg. Number of Number of visits visits Pre-2012. Post-2012 23 to 25 2.3 27 to 29 2.5 approximately 0.3 more visits. approximately 0.7 more visits. approximately 0.4 fewer visits. approximately 0.7 fewer visits. approximately 0.3 fewer visits. 020202 337 SUCHARY 3.0 2.9 P 1302 126 70 5572 25 20120822 2012 Carrow_forwardOne hypothesis for exploring socioeconomic status health disparities is the allostatic load hypothesis. This hypothesis states that repeated (or chronic) stress creates a cumulative physiological burden known as allostatic load. The theory predicts that people on the lower end of the socioeconomic status will have a higher allostatic load, negatively impacting health outcomes.In the context of the Grossman model, we could say that individuals with lower levels of stress face a rate of health depreciation and will have optimal health as a result. lower; higher higher; higher lower; lower higher; lower O Oarrow_forward
- Indicate whether each statement is true or false, and justify your answer.One reason why total health expenditures are rising is because of an aging population.arrow_forwardIndicate whether the statement is true or false, and justify your answer.In the RAND HIE, the arc elasticity of demand for inpatient care was larger (in absolute value) than the arc elasticity of demand for outpatient care.arrow_forwardConsider that you want to apply the difference-in-differences approach to evaluate the Health Insurance Subsidy Program (HISP). In this scenario, you have two rounds of data on two groups of households: one group that enrolled in the program, and another that did not. You know that you cannot compare the average health expenditures of the two groups because of selection bias, thus you decide to compare change in health expenditures as follows: Table 7.2 Evaluating HISP: Difference-in-Differences Comparison of Means After Before (baseline) (follow-up) Difference Enrolled 7.84 14.49 -6.65 Nonenrolled 22.30 20.79 1.51 Difference DD = -6.65 – 1.51 = -8.16 Note: The table presents mean household health expenditures (in dollars) for enrolled and nonenrolled households, before and after the introduction of HISP. How should you interpret this difference ($USD -8.16)? What are the basic assumptions required to accept this result from difference-in-differences?arrow_forward
- Indicate whether each statement is true or false, and justify your answer.Cost–benefit analysis (CBA) allows us to pick an optimal treatment from the list of potentially cost-effective treatments.arrow_forwardOne of the most robust, fundamental “facts” of health economics is the SES and health gradient. a) Define the SES and health gradient. b) Give three ways in which the SES and health gradient is robust. c) Provide evidence that some of the gradient is correlational (i.e., give a potential confounder) and evidence that the gradient is in fact causal. d) i. Give an interpretation of Figure 1 below in layperson terms. ii. What pattern do you see for men vs women? iii. “The education and mortality gradient does not depend on healthcare spending or whether the country has universal healthcare.” Use Figure 1 to support or refute this claim.arrow_forwardIndicate whether the statement is true or false, and justify your answer.Results from the Oregon Medicaid Experiment suggest that having health insurance has a positive impact on health status.arrow_forward
- Indicate whether the statement is true or false, and justify your answer.At firms that do not provide health insurance, the wages of obese workers are lower than the wages of non-obese workers with similar levels of productivity.arrow_forwardOne major premise of the Rothschild–Stiglitz model is that there is a perfectly competitive market for health insurance. Suppose instead that the market is not perfectly competitive, and in fact competitor firms have a hard time entering the market. Could a pooling equilibrium occur in this case? What is it about competition that prevents pooling in the Rothschild–Stiglitz model? No formal proof is necessary, but do make your reasoning clear. Evaluate the following statement: competition in health insurance markets is harmful.arrow_forwardWhile it may seem intuitively obvious that health expenditures will increase as a population age – older people, after all, are less healthy on average than younger people – in fact, several prominent health economists have argued that it is not ageing per se, but rather some of the correlates of an ageing population that cause health expenditures to rise as population ages. For instance, Getzen (1992) argues that, at least in part, rising health expenditures with an ageing population are due to the higher incomes and resources of the older population; health care is a normal good, so higher incomes lead to higher expenditures. In a similar manner, Zweifel et al. (1999) argue that the real problem with an ageing population, at least as far as health care costs are concerned, is that there will be more people who are within a couple of years of dying. Since health care expenditures rise sharply close to the end of life, it is this, rather than population ageing by itself, that leads to…arrow_forward
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