Health economics

Christopher J. Ruhm, 29 October 2015

Conventional wisdom tells us that health deteriorates when the economy weakens and improves when it strengthens. Some research tentatively agrees, but there is a marked dearth of challenges and robust research. This column presents new evidence suggesting that the reductions in mortality occurring during typical economic downturns also occur in periods of crisis, adding useful caveats for different types of downturns and crises.

Jan van Ours, Ali Palali, 16 October 2015

A major aim of cigarette taxes and tobacco control policies is to encourage smokers to quit. It is therefore important to understand the dynamics of quitting decisions in two-smoker couples. This column uses Dutch data to examine whether spousal peer effects exist for smoking cessation decisions. After controlling for the fact that couples are more likely to be similar to begin with, no evidence is found of one partner’s decision to quit affecting their spouse’s decision.

Hiroyuki Motegi, Yoshinori Nishimura, Kazuyuki Terada, 25 September 2015

It is still not clear whether the effect of retirement on health is positive or negative. This column discusses new evidence from Japan showing that it is likely positive. In Japan, elderly people reduce their smoking and drinking after retirement. People tend to smoke and drink with their colleagues, so the result is mostly due to a peer effect.

Sarah Baird, Joan Hamory Hicks, Michael Kremer, Edward Miguel, 11 August 2015

Two billion people across the world are infected with parasitic worms. The World Health Organization recommends mass deworming where there are large and growing populations of infected people. This column assesses whether mass deworming has been ‘debunked’ in favour of deworming on a case-by-case basis, as has recently been reported, but with a particular focus on education. Mass deworming usually takes place in schools and therefore plays a huge and under-researched role in getting children to turn up to school. In fact, it is a more cost-effective way of increasing school attendance than a number of other popular policy options.

Terence Cheng, Joan Costa-i-Font, Nattavudh Powdthavee, 31 July 2015

Economists have traditionally viewed healthcare as a luxury good – consumption of it will increase more than proportionally as income rises. This column challenges this view, exploiting the windfall of lottery winnings to estimate elasticities for healthcare demand in the UK. Results suggest that income elasticities for public healthcare services are close to zero. A medium to large windfall is found instead to increase the uptake of private health insurance and preventative services. This suggests that rising incomes will increase private sector demand, but will leave public healthcare demand unchanged.

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