Are Recessions Good for Your Health? A Macroeconomic Analysis
This paper first documents several important business cycle properties of health expenditures across countries. We then develop a stochastic dynamic general equilibrium model with endogenous health accumulation. The model has three distinguished features: 1). Health enters into utility function; 2) Health enters into production function; 3). Both goods and time input are used to produce health stock. We calibrate the model to US economy. The results replicate the stylized facts of medical expenditure and health status over business cycles. We also investigate the relative importance of each feature in affecting the business cycle properties of health accumulation.
|Date of creation:||2011|
|Contact details of provider:|| Postal: Society for Economic Dynamics Marina Azzimonti Department of Economics Stonybrook University 10 Nicolls Road Stonybrook NY 11790 USA|
Web page: http://www.EconomicDynamics.org/
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