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Improving prevention compliance through appropriate incentives

Author

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  • Schneider, Udo
  • Zerth, Jürgen

Abstract

This paper theoretically and empirically explores the effects of insurance parameters and a complementary information environment on patient´s primary prevention activity in the context of a managed care organisation. The theoretical model is based on a principal-agent setting in which the patient is acting as an agent in deciding about his preventive effort. Both for the patient and for the insurer the information distribution about prevention efforts is diluted. Hence, the theoretical results reflect the impact of insurance parameters as well as complementary information settings. The empirical investigation sheds the light on the patient´s prevention decision in the case of smoking. This depends on age effects, education, working time and health status. The research also stresses the relationship between monetary incentive schemes and individual behaviour as well as the influence of additional information schemes. In addition to the theoretical results, there is an evidence that changes in health behaviour depend on education and individual health assessment, too.

Suggested Citation

  • Schneider, Udo & Zerth, Jürgen, 2008. "Improving prevention compliance through appropriate incentives," MPRA Paper 8280, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:8280
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    References listed on IDEAS

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    More about this item

    Keywords

    Incentives in Prevention; Information distribution;

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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