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Zero‐Inflated Endogenous Count In Censored Model: Effects Of Informal Family Care On Formal Health Care

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  • Myoung‐jae Lee
  • Young‐sook Kim

Abstract

If informal family health care is a substitute for formal health care, then there is a scope to reduce formal health care cost by promoting informal family health care. With the use of Korean data for the elderly, this paper estimates the effects of informal family health care on formal health care, where the former is measured by the number of caregivers and the latter is measured by the formal health care expenditure. This task, however, poses a number of difficulties. The first is that the number of the family caregivers is an endogenous count regressor. The second is that there are too many zeros in the count (85%). The third is that the response variable also has a nontrivial proportion of zeros (14%). This paper overcomes these problems by combining ‘control function approach’, ‘zero‐inflated’ counts, and a semiparametric estimator for censored models. The resulting procedure avoids strong parametric assumptions and behaves well computationally. Our main empirical finding is that informal family health care has a large substitute effect for diabetics and that there are also weak evidences that informal family health care has substitute effects for high blood pressure and mental diseases. Copyright © 2012 John Wiley & Sons, Ltd.

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  • Myoung‐jae Lee & Young‐sook Kim, 2012. "Zero‐Inflated Endogenous Count In Censored Model: Effects Of Informal Family Care On Formal Health Care," Health Economics, John Wiley & Sons, Ltd., vol. 21(9), pages 1119-1133, September.
    • Handle: RePEc:wly:hlthec:v:21:y:2012:i:9:p:1119-1133
    DOI: 10.1002/hec.2822
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    References listed on IDEAS

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    Cited by:

    1. Matteo Lippi Bruni & Cristina Ugolini, 2016. "Delegating home care for the elderly to external caregivers? An empirical study on Italian data," Review of Economics of the Household, Springer, vol. 14(1), pages 155-183, March.
    2. Joan Costa-Font & Martin Karlsson & Henning Øien, 2015. "Informal Care and the Great Recession," CINCH Working Paper Series 1502, Universitaet Duisburg-Essen, Competent in Competition and Health, revised Feb 2015.
    3. Bérengère Davin & Xavier Joutard & Alain Paraponaris, 2019. ""If You Were Me": Proxy Respondents' Biases in Population Health Surveys," Working Papers halshs-02036434, HAL.
    4. Changhui Kang & Myoung-jae Lee, 2014. "Estimation of Binary Response Models With Endogenous Regressors," Pacific Economic Review, Wiley Blackwell, vol. 19(4), pages 502-530, October.

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