Medical Expenditure Puzzle
AbstractWhat does your medical expenditure do to your health? Researchers often get significant negative sign on the relative coefficient in the reduced form health production regression. The puzzling result motivates this simple dynamic quantitative general equilibrium model to study the relationships between health status, medical expenditure and employment. The structural parameters are estimated by an indirect inference procedure. This paper finds that the simulated coefficient of medical expenditure in the health equation is negative even though in the health evolution equation of the structural model, medical expenditure only impacts the health in the positive way
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Bibliographic InfoPaper provided by Society for Economic Dynamics in its series 2006 Meeting Papers with number 284.
Date of creation: 03 Dec 2006
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Postal: Society for Economic Dynamics Christian Zimmermann Economic Research Federal Reserve Bank of St. Louis PO Box 442 St. Louis MO 63166-0442 USA
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medical expenditure; employment; dynamics; indirect inference;
Find related papers by JEL classification:
- I10 - Health, Education, and Welfare - - Health - - - General
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