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The utility of health and wealth

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  • Levy, Moshe
  • Nir, Adi Rizansky
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    Abstract

    Tradeoffs between health and wealth are among the most important decisions individuals make, and are central to social and economic policy. Yet, only a few studies have investigated the utility of health and wealth empirically. This paper investigates this utility function both theoretically and empirically. We conduct detailed personal interviews with 180 cancer patients, and also obtain questionnaires from 132 diabetes patients. We find strong support for the utility function U(h, w)=h·log(w), where h denotes health and w denotes wealth.

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    Bibliographic Info

    Article provided by Elsevier in its journal Journal of Health Economics.

    Volume (Year): 31 (2012)
    Issue (Month): 2 ()
    Pages: 379-392

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    Handle: RePEc:eee:jhecon:v:31:y:2012:i:2:p:379-392

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    Web page: http://www.elsevier.com/locate/inca/505560

    Related research

    Keywords: Utility; Health; Wealth; Logarithmic preference;

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    Cited by:
    1. Moshe Levy & Adi Rizansky, 2014. "Market failure in the pharmaceutical industry and how it can be overcome: the CureShare mechanism," The European Journal of Health Economics, Springer, vol. 15(2), pages 143-156, March.

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