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Non-monotonic health behaviours - implications for individual health-related behaviour in a demand-for-health framework

  • Bolin, Kristian

    ()

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

  • Lindgren, Björn

    (Centre for Health Economics, University of Gothenburg, Gotenburg, Sweden; Dept of Health Sciences, Lund University, Lund, Sweden; National Bureau of Economic Research, Cambridge MA, US)

Registered author(s):

    A number of behaviours influence health in a non-monotonic way. Physical activity and alcohol consumption, for instance, may be beneficial to one’s health in moderate but detrimental in large quantities. We develop a demand-for-health framework that incorporates the feature of a physiologically optimal level. An individual may still choose a physiologically non-optimal level, because of the trade-off in his or her preferences for health versus other utility-affecting commodities. However, any deviation from the physiologically optimal level will be punished with respect to health. A set of steady-state comparative statics is derived regarding the effects on the demand for health and health-related behaviour, indicating that individuals will react differently to exogenous changes, depending on the amount of the health-related behaviour they demand. We also show (a) that a steady-state equilibrium is a saddle-point and (b) that the physiologically optimal level may be a steady-state equilibrium for the individual. Our analysis suggests that general public-health policies may, to some extent, be counterproductive due to the responses induced in parts of the population.

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    File URL: https://gupea.ub.gu.se/handle/2077/35521
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    Paper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 588.

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    Length: 36 pages
    Date of creation: 27 Mar 2014
    Date of revision:
    Handle: RePEc:hhs:gunwpe:0588
    Contact details of provider: Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
    Phone: 031-773 10 00
    Web page: http://www.handels.gu.se/econ/

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