IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper

Individual investments in education and health

  • Carbone, Jared C.

    (Department of Economics, University of Calgary)

  • Kverndokk, Snorre

    ()

    (Ragnar Frisch Centre for Economic Research)

Empirical studies show that years of schooling are positively correlated with good health, and that education is better correlated with health than with variables like occupation and income. This can be explained in different ways as the implication may go from education to health, from health to education, and there may be variables that influence health and education in the same direction. The effect of different policy instruments to reduce the social gradient in health will depend on the strength of these causalities. In this paper we formalize a model that simultaneously determines an individual’s demand for knowledge and health based on the mentioned causal effects. We study the impacts on both health and education of different policy instruments such as subsidies on medical care, subsidizing schooling, income tax reduction, lump sum transfers and improving health at young age. Our results indicate that income transfers such as distributional policies may be the best instrument to improve welfare, while subsidies to medical care is the best instrument for longevity. However, subsidies to medical care or education would require large imperfections in the markets for health and education to be more welfare improving than distributional policies. Finally, our simulations suggest that underlying factors that impact both health and education is the main explanation for the correlation shown empirically.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.med.uio.no/helsam/forskning/nettverk/hero/publikasjoner/skriftserie/2014/hero2014-1.pdf
Download Restriction: no

Paper provided by Oslo University, Health Economics Research Programme in its series HERO On line Working Paper Series with number 2014:1.

as
in new window

Length: 55 pages
Date of creation: 01 Mar 2014
Date of revision:
Handle: RePEc:hhs:oslohe:2014_001
Contact details of provider: Postal:
HERO / Institute of Health Management and Health Economics P.O. Box 1089 Blindern, N-0317 Oslo, Norway

Phone: 2307 5309
Fax: 2307 5310
Web page: http://www.hero.uio.no/eng.html
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. M. Christopher Auld & Nirmal Sidhu, 2005. "Schooling, cognitive ability and health," Health Economics, John Wiley & Sons, Ltd., vol. 14(10), pages 1019-1034.
  2. Brunello, Giorgio & Fort, Margherita & Schneeweis, Nicole & Winter-Ebmer, Rudolf, 2011. "The Causal Effect of Education on Health: What is the Role of Health Behaviors?," IZA Discussion Papers 5944, Institute for the Study of Labor (IZA).
  3. Bénédicte H. Apouey & Andrew E. Clark, 2015. "Winning Big but Feeling no Better? The Effect of Lottery Prizes on Physical and Mental Health," Post-Print halshs-01155641, HAL.
  4. Ryan D. Edwards, 2010. "Health, Income, and the Timing of Education Among Military Retirees," NBER Working Papers 15778, National Bureau of Economic Research, Inc.
  5. Halliday, Timothy J. & He, Hui & Zhang, Hao, 2009. "Health Investment over the Life-Cycle," IZA Discussion Papers 4482, Institute for the Study of Labor (IZA).
  6. Sarah Dahmann, 2015. "How Does Education Improve Cognitive Skills? Instructional Time versus Timing of Instruction," SOEPpapers on Multidisciplinary Panel Data Research 769, DIW Berlin, The German Socio-Economic Panel (SOEP).
  7. repec:pri:cheawb:case_paxson_economic_status_paper is not listed on IDEAS
  8. Cutler, David M. & Lleras-Muney, Adriana, 2010. "Understanding Differences in Health Behaviors by Education," Scholarly Articles 5344195, Harvard University Department of Economics.
  9. Petter Lundborg, 2013. "The health returns to schooling—what can we learn from twins?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 26(2), pages 673-701, April.
  10. Cutler, David M. & Lleras-Muney, Adriana, 2010. "Understanding differences in health behaviors by education," Journal of Health Economics, Elsevier, vol. 29(1), pages 1-28, January.
  11. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75, pages 352.
  12. Jere R. Behrman & Mark R. Rosenzweig, 2004. "Returns to Birthweight," The Review of Economics and Statistics, MIT Press, vol. 86(2), pages 586-601, May.
  13. Carbone, Jared C. & Kverndokk, Snorre & Rogeberg, Ole Jorgen, 2005. "Smoking, health, risk, and perception," Journal of Health Economics, Elsevier, vol. 24(4), pages 631-653, July.
  14. Adams, Peter & Hurd, Michael D. & McFadden, Daniel & Merrill, Angela & Ribeiro, Tiago, 2003. "Healthy, wealthy, and wise? Tests for direct causal paths between health and socioeconomic status," Journal of Econometrics, Elsevier, vol. 112(1), pages 3-56, January.
  15. Aparicio Fenoll, Ainhoa & Gonzalez, Libertad, 2014. "Newborn Health and the Business Cycle: Is It Good to Be Born in Bad Times?," IZA Discussion Papers 8031, Institute for the Study of Labor (IZA).
  16. Frijters, Paul & Haisken-DeNew, John P. & Shields, Michael A., 2005. "The causal effect of income on health: Evidence from German reunification," Journal of Health Economics, Elsevier, vol. 24(5), pages 997-1017, September.
  17. Kevin M. Murphy & Robert H. Topel, 2006. "The Value of Health and Longevity," Journal of Political Economy, University of Chicago Press, vol. 114(5), pages 871-904, October.
  18. Case, Anne & Fertig, Angela & Paxson, Christina, 2005. "The lasting impact of childhood health and circumstance," Journal of Health Economics, Elsevier, vol. 24(2), pages 365-389, March.
  19. Costas Meghir & Mårten Palme & Emilia Simeonova, 2012. "Education, Health and Mortality: Evidence from a Social Experiment," NBER Working Papers 17932, National Bureau of Economic Research, Inc.
  20. Titus Galama & Hans van Kippersluis, 2015. "A Theory of Education and Health," Working Papers 2015-007, Human Capital and Economic Opportunity Working Group.
  21. Anne Case & Darren Lubotsky & Christina Paxson, 2002. "Economic status and health in childhood: the origins of the gradient," Working Papers 262, Princeton University, Woodrow Wilson School of Public and International Affairs, Center for Health and Wellbeing..
  22. Joan Costa-i-Font & Martin Karlsson & Henning Øien, 2015. "Informal care and the great recession," LSE Research Online Documents on Economics 62606, London School of Economics and Political Science, LSE Library.
  23. Anna Aizer & Laura Stroud, 2010. "Education, Knowledge and the Evolution of Disparities in Health," NBER Working Papers 15840, National Bureau of Economic Research, Inc.
  24. Titus J. Galama & Hans van Kippersluis, 2015. "A Theory of Education and Health," CINCH Working Paper Series 1503, Universitaet Duisburg-Essen, Competent in Competition and Health, revised Mar 2015.
  25. Jon Gjerde & Sverre Grepperud & Snorre Kverndokk, 2005. "On adaptation and the demand for health," Applied Economics, Taylor & Francis Journals, vol. 37(11), pages 1283-1301.
  26. Chapman, Kenneth S & Hariharan, Govind, 1996. "Do Poor People Have a Stronger Relationship between Income and Mortality Than the Rich? Implications of Panel Data for Health-Health Analysis," Journal of Risk and Uncertainty, Springer, vol. 12(1), pages 51-63, January.
  27. Altindag, Duha & Cannonier, Colin & Mocan, Naci, 2011. "The impact of education on health knowledge," Economics of Education Review, Elsevier, vol. 30(5), pages 792-812, October.
  28. Jan Goebel & Christian Krekel & Tim Tiefenbach & Nicholas R. Ziebarth, 2014. "Natural Disaster, Environmental Concerns, Well-Being and Policy Action," CINCH Working Paper Series 1405, Universitaet Duisburg-Essen, Competent in Competition and Health.
  29. repec:pri:rpdevs:case_and_paxson_whitehall_jan_2011 is not listed on IDEAS
  30. Ngina Chiteji, 2010. "Time Preference, Noncognitive Skills and Well Being across the Life Course: Do Noncognitive Skills Encourage Healthy Behavior?," American Economic Review, American Economic Association, vol. 100(2), pages 200-204, May.
  31. Lindahl, Mikael, 2002. "Estimating the Effect of Income on Health and Mortality Using Lottery Prizes as Exogenous of Variation in Income," IZA Discussion Papers 442, Institute for the Study of Labor (IZA).
  32. Paul Contoyannis & Andrew M. Jones & Nigel Rice, 2004. "The dynamics of health in the British Household Panel Survey," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 19(4), pages 473-503.
  33. Daniel Avdic, 2015. "A Matter of Life and Death? Hospital Distance and Quality of Care - Evidence from Emergency Hospital Closures and Myocardial Infarctions," CINCH Working Paper Series 1501, Universitaet Duisburg-Essen, Competent in Competition and Health, revised Jan 2015.
  34. Michael Grossman, 2003. "Household Production and Health," Review of Economics of the Household, Springer, vol. 1(4), pages 331-342, December.
  35. Rucker C. Johnson, 2011. "Long-run Impacts of School Desegregation & School Quality on Adult Attainments," NBER Working Papers 16664, National Bureau of Economic Research, Inc.
  36. Dahmann, Sarah, 2015. "How does education improve cognitive skills? Instructional Time versus Timing of Instruction," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112917, Verein für Socialpolitik / German Economic Association.
  37. Michael, Robert T, 1973. "Education in Nonmarket Production," Journal of Political Economy, University of Chicago Press, vol. 81(2), pages 306-27, Part I, M.
  38. Sherry Glied & Adriana Lleras-Muney, 2008. "Technological innovation and inequality in health," Demography, Springer;Population Association of America (PAA), vol. 45(3), pages 741-761, August.
  39. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, June.
  40. Resul Cesur & Inas Rashad, 2008. "High Birth Weight and Cognitive Outcomes," NBER Working Papers 14524, National Bureau of Economic Research, Inc.
  41. Hendrik Jürges & Eberhard Kruk & Steffen Reinhold, 2013. "The effect of compulsory schooling on health—evidence from biomarkers," Journal of Population Economics, Springer;European Society for Population Economics, vol. 26(2), pages 645-672, April.
  42. Joshua J. Robinson, 2014. "Sound Body, Sound Mind?," CINCH Working Paper Series 1403, Universitaet Duisburg-Essen, Competent in Competition and Health.
  43. repec:pri:cheawb:case_and_paxson_whitehall_jan_2011 is not listed on IDEAS
  44. Gary S. Becker & Casey B. Mulligan, 1997. "The Endogenous Determination of Time Preference," The Quarterly Journal of Economics, Oxford University Press, vol. 112(3), pages 729-758.
  45. de Walque, Damien, 2004. "Education, information, and smoking decisions : evidence from smoking histories, 1940-2000," Policy Research Working Paper Series 3362, The World Bank.
  46. James P. Smith, 2007. "The Impact of Socioeconomic Status on Health over the Life-Course," Journal of Human Resources, University of Wisconsin Press, vol. 42(4).
  47. Ciro Avitabile & Tullio Jappelli & Mario Padula, 2008. "Screening Tests, Information, and the Health-Education Gradient," CSEF Working Papers 187, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy, revised 28 Apr 2008.
  48. Anne Case & Christina Paxson, 2010. "The Long Reach of Childhood Health and Circumstance: Evidence from the Whitehall II Study," NBER Working Papers 15640, National Bureau of Economic Research, Inc.
  49. Douglas Almond & Kenneth Y. Chay & David S. Lee, 2005. "The Costs of Low Birth Weight," The Quarterly Journal of Economics, Oxford University Press, vol. 120(3), pages 1031-1083.
  50. John Karl Scholz & Ananth Seshadri, 2010. "Health and Wealth in a Life Cycle Model," Working Papers wp224, University of Michigan, Michigan Retirement Research Center.
  51. de Walque, Damien, 2007. "Does education affect smoking behaviors?: Evidence using the Vietnam draft as an instrument for college education," Journal of Health Economics, Elsevier, vol. 26(5), pages 877-895, September.
  52. Marjon van der Pol, 2011. "Health, education and time preference," Health Economics, John Wiley & Sons, Ltd., vol. 20(8), pages 917-929, 08.
  53. Muurinen, Jaana-Marja, 1982. "Demand for health: A generalised Grossman model," Journal of Health Economics, Elsevier, vol. 1(1), pages 5-28, May.
  54. Grossman, Michael, 1972. "On the Concept of Health Capital and the Demand for Health," Journal of Political Economy, University of Chicago Press, vol. 80(2), pages 223-55, March-Apr.
  55. Sarah Dahmann, 2015. "How Does Education Improve Cognitive Skills? - Instructional Time versus Timing of Instruction," CINCH Working Paper Series 1504, Universitaet Duisburg-Essen, Competent in Competition and Health, revised Apr 2015.
  56. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4 National Bureau of Economic Research, Inc.
  57. De Walque, Damien, 2004. "How does the impact of an HIV/AIDS information campaign vary with educational attainment ? Evidence from rural Uganda," Policy Research Working Paper Series 3289, The World Bank.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:hhs:oslohe:2014_001. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Anbjørg Kolaas)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.