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Some notes on how to catch a red herring - Ageing, time-to-death and care costs for older people in Sweden

Author

Listed:
  • Karlsson, Martin

    () (Department of Law and Economics, Technische Universität Darmstadt)

  • Klohn, Florian

    () (Department of Law and Economics, Technische Universität Darmstadt)

Abstract

In this paper we test the 'red herring' hypothesis for expenditures on long-term care. The main contribution of this paper is that we assess the 'red herring' hypothesis using an aggregated measure that allows us to control for entering the final period of life on the individual level. In addition we implement a model that allows for age specific time-to-death (TTD) effects on Long Term Care. We also account for the problem that mortality, and therefore TTD, are themselves influenced by care expenditure. For our analysis we use administrative data from the Swedish statistical office. In contrast to many previous empirical studies, we are able to use the entire population for estimation instead of a sample. Our identification strategy is based on fixed effects estimation and the instrumental variable approach to achieve exogenous variation in TTD. Our results indicate that although time-to-death is a relevant indicator for long term care, age itself seems to be much more important for the projection of long-term care expenditure.

Suggested Citation

  • Karlsson, Martin & Klohn, Florian, 2011. "Some notes on how to catch a red herring - Ageing, time-to-death and care costs for older people in Sweden," HERO On line Working Paper Series 2011:6, Oslo University, Health Economics Research Programme.
  • Handle: RePEc:hhs:oslohe:2011_006
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    File URL: http://www.med.uio.no/helsam/forskning/nettverk/hero/publikasjoner/skriftserie/2011/2011_6.pdf
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    References listed on IDEAS

    as
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    Cited by:

    1. Friedrich Breyer & Normann Lorenz & Thomas Niebel, 2015. "Health care expenditures and longevity: is there a Eubie Blake effect?," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 16(1), pages 95-112, January.
    2. Siciliani Luigi, 2013. "The Economics of Long-Term Care," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 14(2), pages 343-375, August.
    3. Atella, Vincenzo & Conti, Valentina, 2014. "The effect of age and time to death on primary care costs: The Italian experience," Social Science & Medicine, Elsevier, vol. 114(C), pages 10-17.

    More about this item

    Keywords

    ageing; mortality; long term care expenditures;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I10 - Health, Education, and Welfare - - Health - - - General
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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