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Wages and the demand for health - a life cycle analysis

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  • Christian Dustmann

    ()
    (Institute for Fiscal Studies and University College London)

  • Frank Windmeijer

    ()
    (Institute for Fiscal Studies and University of Bristol)

Abstract

This paper presents a life cycle model for the demand for health, and derives empirical specifications that distinguish between permanent and transitory wage responses. Using panel data, we estimate dynamic health and health input demand equations. We find evidence of negative transitory wage effects, and positive permanent effects. Estimation results based on our life cylce framework lead to very different conclusions than those based on static cross section analyses that are common in the literature. This analysis emphasises the importance to analyse health related behaviour in a dynamic life cycle context.

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Bibliographic Info

Paper provided by Institute for Fiscal Studies in its series IFS Working Papers with number W99/20.

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Length: 44 pp.
Date of creation: Jun 2000
Date of revision:
Handle: RePEc:ifs:ifsewp:99/20

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  1. Blundell, R. & Bond, S., 1995. "Initial Conditions and Moment Restrictions in Dynamic Panel Data Models," Economics Papers 104, Economics Group, Nuffield College, University of Oxford.
  2. Million, Andreas & Rotte, Ralph & Zimmermann, Klaus F, 1996. "Economic Incentives and Hospitalization in Germany," CEPR Discussion Papers 1516, C.E.P.R. Discussion Papers.
  3. Cropper, M L, 1981. "Measuring the Benefits from Reduced Morbidity," American Economic Review, American Economic Association, vol. 71(2), pages 235-40, May.
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  6. Heckman, James J & Ichimura, Hidehiko & Todd, Petra, 1998. "Matching as an Econometric Evaluation Estimator," Review of Economic Studies, Wiley Blackwell, vol. 65(2), pages 261-94, April.
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  13. Richard Blundell & Rachel Griffith & Frank Windmeijer, 1999. "Individual effects and dynamics in count data models," IFS Working Papers W99/03, Institute for Fiscal Studies.
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  15. Geil, Peter, et al, 1997. "Economic Incentives and Hospitalization in Germany," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 12(3), pages 295-311, May-June.
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  24. repec:cup:etheor:v:13:y:1997:i:5:p:667-78 is not listed on IDEAS
  25. Eisenring, Christoph, 1999. "Comparative dynamics in a health investment model," Journal of Health Economics, Elsevier, vol. 18(5), pages 653-658, October.
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Citations

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Cited by:
  1. Laura Blow & Andrew Leicester & Frank Windmeijer, 2005. "Parental income and children's smoking behaviour: evidence from the British Household Panel Survey," IFS Working Papers W05/10, Institute for Fiscal Studies.
  2. Andersson, Fredrik & Konrad, Kai A, 2001. "Globalization and Human Capital Formation," CEPR Discussion Papers 2657, C.E.P.R. Discussion Papers.
  3. Dhaval M. Dave & Inas Rashad Kelly, 2010. "How Does the Business Cycle Affect Eating Habits?," NBER Working Papers 16638, National Bureau of Economic Research, Inc.
  4. Christopher J. Ruhm, 2006. "A Healthy Economy Can Break Your Heart," NBER Working Papers 12102, National Bureau of Economic Research, Inc.
  5. Zhao, Zhong, 2005. "Analysis of Health and Longevity in Oldest-Old Population: A Health Capital Approach," IZA Discussion Papers 1877, Institute for the Study of Labor (IZA).
  6. Christopher J. Ruhm, 2004. "Macroeconomic Conditions, Health and Mortality," NBER Working Papers 11007, National Bureau of Economic Research, Inc.
  7. Gabriel A. Picone & Frank Sloan & Justin G. Trogdon, 2004. "The effect of the tobacco settlement and smoking bans on alcohol consumption," Health Economics, John Wiley & Sons, Ltd., vol. 13(10), pages 1063-1080.
  8. Ana Llena-Nozal & Maarten Lindeboom & France Portrait, 2005. "The effect of work on mental health: Does occupation Matter?," Labor and Demography 0501011, EconWPA.
  9. Zhao, Zhong, 2005. "Health Determinants in Urban China," IZA Discussion Papers 1835, Institute for the Study of Labor (IZA).

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