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On fatalistic long-term health behavior

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Author Info

  • Macé, Serge
  • Le Lec, Fabrice

Abstract

Many adults have an overly pessimistic view of old age because they fail to correctly predict their ability to hedonically adapt to old-age health related problems. A standard utility model where the marginal utility of health is higher at a lower level of health predicts that this overly pessimist view raises the incentive for healthy behavior. But this is at odds with empirical research that indicates that people with more negative aging stereotypes tend to adopt less healthy practices, transforming this negative view into a self-fulfilling prophecy. The aim of this note is to show that this fatalistic behavior can be explained through prospect theory by modelling this overly pessimistic view of old age as a failure to predict the change in the reference point due to hedonic adaptation. Given the diminishing sensitivity in the loss domain, people undervalue the future marginal value of health investment and may therefore underinvest in health as long as loss aversion is not too strong.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Psychology.

Volume (Year): 32 (2011)
Issue (Month): 3 (June)
Pages: 434-439

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Handle: RePEc:eee:joepsy:v:32:y:2011:i:3:p:434-439

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Web page: http://www.elsevier.com/locate/joep

Related research

Keywords: Hedonic adaptation Health Aging Prospect theory;

References

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  1. Thaler, Richard, 1980. "Toward a positive theory of consumer choice," Journal of Economic Behavior & Organization, Elsevier, vol. 1(1), pages 39-60, March.
  2. Richard H. Thaler, 2008. "Mental Accounting and Consumer Choice," Marketing Science, INFORMS, vol. 27(1), pages 15-25, 01-02.
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  4. Blanchflower, David G. & Oswald, Andrew J., 2007. "Is Well-Being U-Shaped over the Life Cycle?," IZA Discussion Papers 3075, Institute for the Study of Labor (IZA).
  5. Wu, Stephen, 2001. "Adapting to heart conditions: a test of the hedonic treadmill," Journal of Health Economics, Elsevier, vol. 20(4), pages 495-507, July.
  6. Albrecht, Gary L. & Devlieger, Patrick J., 1999. "The disability paradox: high quality of life against all odds," Social Science & Medicine, Elsevier, vol. 48(8), pages 977-988, April.
  7. Heather P. Lacey & Angela Fagerlin & George Loewenstein & Dylan M. Smith & Jason Riis & Peter A. Ubel, 2006. "It must be awful for them: Healthy people overlook disease variability in quality of life judgments," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 1, pages 146-152, November.
  8. Heather Lacey & Dylan Smith & Peter Ubel, 2006. "Hope I Die before I Get Old: Mispredicting Happiness Across the Adult Lifespan," Journal of Happiness Studies, Springer, vol. 7(2), pages 167-182, 06.
  9. Oswald, Andrew J. & Powdthavee, Nattavudh, 2008. "Does happiness adapt? A longitudinal study of disability with implications for economists and judges," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1061-1077, June.
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Cited by:
  1. Octave Jokung & Serge Macé, 2013. "Long-term health investment when people underestimate their adaptation to old age-related health problems," The European Journal of Health Economics, Springer, vol. 14(6), pages 1003-1013, December.

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