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Limited Life Expectancy, Human Capital and Health Investments

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  • Emily Oster
  • Ira Shoulson
  • E. Ray Dorsey

Abstract

Human capital theory predicts that life expectancy will impact human capital attainment. We estimate this relationship using variation in life expectancy driven by Huntington disease, an inherited neurological disorder. We compare investments for individuals who have ex-ante identical risks of HD but differ in disease realization. Individuals with the HD mutation complete less education and job training. The elasticity of demand for college attendance with respect to life expectancy is around 1.0. We relate this to cross-country and over-time differences in education. We use smoking and cancer screening data to test the corollary that health capital responds to life expectancy.

Suggested Citation

  • Emily Oster & Ira Shoulson & E. Ray Dorsey, 2013. "Limited Life Expectancy, Human Capital and Health Investments," American Economic Review, American Economic Association, vol. 103(5), pages 1977-2002, August.
  • Handle: RePEc:aea:aecrev:v:103:y:2013:i:5:p:1977-2002
    Note: DOI: 10.1257/aer.103.5.1977
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    References listed on IDEAS

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    Cited by:

    1. Mohammad Mainul Hoque & Elizabeth King & Claudio E. Montenegro & Peter F. Orazem, 2017. "Longevity and Lifetime Education: Global Evidence from 919 Surveys," Working Papers wp450, University of Chile, Department of Economics.
    2. Matthew Calver, 2016. "Measuring the Appropriate Outcomes for Better Decision-Making: A Framework to Guide the Analysis of Health Policy," CSLS Research Reports 2016-03, Centre for the Study of Living Standards.
    3. Schünemann, Johannes & Strulik, Holger & Trimborn, Timo, 2017. "Going from bad to worse: Adaptation to poor health health spending, longevity, and the value of life," Journal of Economic Behavior & Organization, Elsevier, vol. 140(C), pages 130-146.
    4. Mohammed Shuaibu & Popoola Timothy Oladayo, 2016. "Determinants Of Human Capital Development In Africa: A Panel Data Analysis," Oeconomia Copernicana, Institute of Economic Research, vol. 7(4), pages 523-549, December.
    5. Sánchez-Romero, Miguel & d׳Albis, Hippolyte & Prskawetz, Alexia, 2016. "Education, lifetime labor supply, and longevity improvements," Journal of Economic Dynamics and Control, Elsevier, vol. 73(C), pages 118-141.
    6. Frankovic, Ivan, 2017. "The impact of climate change on health expenditures," ECON WPS - Vienna University of Technology Working Papers in Economic Theory and Policy 02/2017, Vienna University of Technology, Institute for Mathematical Methods in Economics, Research Group Economics (ECON).
    7. Huang, Chieh-Wei & Huarng, Kun-Huang, 2015. "Evaluating the performance of biotechnology companies by causal recipes," Journal of Business Research, Elsevier, vol. 68(4), pages 851-856.
    8. Geppert, Christian, 2015. "On the Distributional Implications of Demographic Change," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113070, Verein für Socialpolitik / German Economic Association.
    9. Huang, Wei & Lei, Xiaoyan & Sun, Ang, 2015. "The Great Expectations: Impact of One-Child Policy on Education of Girls," IZA Discussion Papers 9301, Institute for the Study of Labor (IZA).
    10. van Hoorn, Andre, 2016. "The Cultural Roots of Human Capital Accumulation," MPRA Paper 80007, University Library of Munich, Germany.
    11. Nuarpear Lekfuangfu, 2016. "Mortality Risk and Human Capital Investment: The Legacy of Landmines in Cambodia," PIER Discussion Papers 35., Puey Ungphakorn Institute for Economic Research, revised Jul 2016.
    12. repec:rsr:supplm:v:65:y:2017:i:4:p:107-114 is not listed on IDEAS
    13. Casper Worm Hansen & Holger Strulik, 2017. "Life expectancy and education: evidence from the cardiovascular revolution," Journal of Economic Growth, Springer, vol. 22(4), pages 421-450, December.
    14. Annarita BALDANZI & Alberto BUCCI & Klaus PRETTNER, 2016. "The Effects of Health Investments on Human Capital and R&D-Driven Economic Growth," Departmental Working Papers 2016-17, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    15. Huo, Jingjing, 2015. "How Nations Innovate: The Political Economy of Technological Innovation in Affluent Capitalist Economies," OUP Catalogue, Oxford University Press, number 9780198735847.
    16. Bhalotra, Sonia R. & Karlsson, Martin & Nilsson, Therese & Schwarz, Nina, 2016. "Infant Health, Cognitive Performance and Earnings: Evidence from Inception of the Welfare State in Sweden," IZA Discussion Papers 10339, Institute for the Study of Labor (IZA).
    17. Jetter, Michael & Laudage, Sabine & Stadelmann, David, 2016. "The Intimate Link between Income Levels and Life Expectancy: Global Evidence from 213 Years," IZA Discussion Papers 10015, Institute for the Study of Labor (IZA).
    18. Baldanzi, Annarita & Bucci, Alberto & Prettner, Klaus, 2017. "Children's health, human capital accumulation, and R&D-based economic growth," Hohenheim Discussion Papers in Business, Economics and Social Sciences 01-2017, University of Hohenheim, Faculty of Business, Economics and Social Sciences.
    19. Barron, Kai & Gamboa, Luis F. & Rodriguez-Lesmes, Paul, 2017. "Behavioural response to a sudden health risk: Dengue and educational outcomes in Colombia," Discussion Papers, Research Unit: Economics of Change SP II 2017-306, Social Science Research Center Berlin (WZB).
    20. repec:rsr:supplm:v:65:y:2017:i:4:p:87-98 is not listed on IDEAS
    21. Holger Strulik & Katharina Werner, 2016. "50 is the new 30—long-run trends of schooling and retirement explained by human aging," Journal of Economic Growth, Springer, vol. 21(2), pages 165-187, June.
    22. Dertwinkel-Kalt, Markus & Wenzel, Tobias, 2015. "Attention and Endogenous Framing," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112971, Verein für Socialpolitik / German Economic Association.
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    More about this item

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I20 - Health, Education, and Welfare - - Education - - - General
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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