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The meaning of death: some numerical simulations of a model of healthy and unhealthy consumption

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  • Martin Forster

Abstract

This paper presents some numerical simulations of a model of healthy and unhealthy consumption to investigate the impact of various terminal conditions on an individual's life-span, pathways of consumption and health. A `benchmark' model, in which both the life-span and the individual's `death' stock of health are xed, is compared to (i) a version in which the `death' stock of health is freely chosen; (ii) a version in which life-span is freely chosen; (iii) a version in which both the `death' stock of health and life-span are freely chosen. Results show how the choice of terminal conditions has a striking impact on both optimal plans and comparative static/dynamic predictions and raise questions about how to model `death' in deterministic demand for health models. Results also illustrate the application of iterative processes to determine an optimal life-span in continuous time models, the role of the marginal value of health capital in determining optimal plans, and the importance of checking the second-order conditions for the optimal choice of life-span in such models.

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  • Martin Forster, "undated". "The meaning of death: some numerical simulations of a model of healthy and unhealthy consumption," Discussion Papers 00/34, Department of Economics, University of York.
    • Handle: RePEc:yor:yorken:00/34
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    Cited by:

    1. Drichoutis, Andreas C. & Lazaridis, Panagiotis & Nayga, Rodolfo M., Jr., 2006. "Nutritional food label use: A theoretical and empirical perspective," 98th Seminar, June 29-July 2, 2006, Chania, Crete, Greece 10033, European Association of Agricultural Economists.
    2. Andreas Drichoutis & Panagiotis Lazaridis & Rodolfo Nayga & Maria Kapsokefalou & George Chryssochoidis, 2008. "A theoretical and empirical investigation of nutritional label use," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 9(3), pages 293-304, August.
    3. Hiroaki Hayakawa, 2017. "Health-conscious consumer behavior," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 7(1), pages 1-31, April.

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    More about this item

    Keywords

    The demand for health; healthy and unhealthy consumption; terminal and transversality conditions; optimal life-span.;
    All these keywords.

    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • H0 - Public Economics - - General

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