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Who opts out of the statutory health insurance? A discrete time hazard model for Germany

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  • Bünnings, Christian
  • Tauchmann, Harald

Abstract

The coexistence of social health insurance and private health insurance in Germany is subject to intense public debate. As only few have the opportunity to choose between the two systems, they are often regarded as privileged by the health insurance system. Applying a hazard model in discrete time, this paper examines the role of incentives set by the regulatory framework as well as the influence of individual personality characteristics on the decision to opt out of the statutory system. To address potential endogeneity of one of the key explanatory variables an instrumental variable approach is also applied. The estimation results yield robust evidence on the choice of health insurance type that is consistent with rational decision making, with both incentives set by regulation and personality traits as relevant determinants.

Suggested Citation

  • Bünnings, Christian & Tauchmann, Harald, 2013. "Who opts out of the statutory health insurance? A discrete time hazard model for Germany," FAU Discussion Papers in Economics 10/2013, Friedrich-Alexander University Erlangen-Nuremberg, Institute for Economics.
  • Handle: RePEc:zbw:iwqwdp:102013
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    References listed on IDEAS

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    Cited by:

    1. Polyakova, Maria, 2016. "Risk selection and heterogeneous preferences in health insurance markets with a public option," Journal of Health Economics, Elsevier, vol. 49(C), pages 153-168.

    More about this item

    Keywords

    statutory and private health insurance; incentives; personality traits;

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private

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