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A dynamic analysis of the demand for health insurance and health care

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  • Bolhaar, Jonneke
  • Lindeboom, Maarten
  • van der Klaauw, Bas

Abstract

We find that asymmetric information is important for the uptake of supplementary private health insurance and health care utilization. We use dynamic panel data models to investigate the sources of asymmetric information and distinguish short-run selection effects into insurance from long-run selection effects. Short-run selection effects (i.e. responses to shocks) are adverse, but small in size. Also long-run effects driven by differences in, for example, preferences and risk aversion, are small. But we find some evidence for multidimensional asymmetric information. For example, mental health causes advantageous selection. Estimates of health care utilization models suggest that moral hazard is not important.

Suggested Citation

  • Bolhaar, Jonneke & Lindeboom, Maarten & van der Klaauw, Bas, 2012. "A dynamic analysis of the demand for health insurance and health care," European Economic Review, Elsevier, vol. 56(4), pages 669-690.
    • Handle: RePEc:eee:eecrev:v:56:y:2012:i:4:p:669-690
    DOI: 10.1016/j.euroecorev.2012.03.002
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    More about this item

    Keywords

    Supplementary private health insurance; Health care utilization; Asymmetric information; Moral hazard; Panel data;
    All these keywords.

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models

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