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The public finance of healthy behavior

  • Robert Rosenman

    ()

Lifestyle can often affect the likelihood an individual will have a future illness. Subsidies often mitigate the consequences of poor lifestyle choices. In this paper we explore tax-subsidy policies that lower the consequences of incurring a non-infectious disease. We find that a funding mechanism consistent with current US policy lowers the investment in healthy lifestyles by both the wealthy, who pay taxes, and the poor, who receive subsidies. We also explore alternative policy interventions such as investing in research to lessen the impact or probability of the disease if an individual gets sick.

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File URL: http://hdl.handle.net/10.1007/s11127-010-9611-z
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Article provided by Springer in its journal Public Choice.

Volume (Year): 147 (2011)
Issue (Month): 1 (April)
Pages: 173-188

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Handle: RePEc:kap:pubcho:v:147:y:2011:i:1:p:173-188
Contact details of provider: Web page: http://www.springerlink.com/link.asp?id=100332

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  8. Samuel H. Preston & Jessica Y. Ho, 2009. "Low Life Expectancy in the United States: Is the Health Care System at Fault?," NBER Working Papers 15213, National Bureau of Economic Research, Inc.
  9. Becker, Gary S & Murphy, Kevin M, 1988. "A Theory of Rational Addiction," Journal of Political Economy, University of Chicago Press, vol. 96(4), pages 675-700, August.
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