IDEAS home Printed from https://ideas.repec.org/p/zbw/wzbhea/spi2007302.html
   My bibliography  Save this paper

The economic benefits of health and prevention in a high-income country: the example of Germany

Author

Listed:
  • Suhrcke, Marc
  • Urban, Dieter M.
  • Moesgaard Iburg, Kim
  • Schwappach, David
  • Boluarte, Till
  • McKee, Martin

Abstract

This paper complements the current health policy debate, which is largely confined to the cost aspects of health systems, by considering explicitly the potential economic benefits of investing in health in general and via - chiefly primary - prevention. While concerns about high and rising health care costs are justified, we see a pressing need to also measure the benefits, ultimately enabling a complete economic assessment of the socially optimal level of resources for health. Despite the use of Germany as our point of reference, our approach and findings likely apply to a wider set of European highincome countries. Using new and already existing data, we find that in sheer health terms Germany has a lot to gain from more and better illness prevention. Assuming part of this existing burden can be reduced via effective preventive interventions, we find that the resulting economic benefits - expressed in people's willingness to pay for a reduction in mortality risk - would be substantial. We also gather Germany-specific evidence to suggest that the existing burden of ill health - whether caused by lack of prevention or treatment - negatively impacts a number of important economic outcomes at the individual and macro-economic level. Referring to work carried out in parallel to this project, we find that a number of cost-effective, primary preventive interventions exist to tackle part of the avoidable disease burden. Yet we note a deficit of economic evaluations, in particular in non-clinical interventions - a finding that underlines the role of government in the production of research on specifically non-clinical prevention. In light of the market failures discussed, from an economic perspective the role of government not only consists of research, but also - surprisingly to many - extends to actual interventions to address the health behaviour-related determinants of chronic disease. With the stakes as high and the economic justification for action in place, the case for scaling up preventive efforts in Germany, backed up by solid epidemiological and economic research, is hard to deny.

Suggested Citation

  • Suhrcke, Marc & Urban, Dieter M. & Moesgaard Iburg, Kim & Schwappach, David & Boluarte, Till & McKee, Martin, 2007. "The economic benefits of health and prevention in a high-income country: the example of Germany," Discussion Papers, Research Group Public Health SP I 2007-302, Social Science Research Center Berlin (WZB).
  • Handle: RePEc:zbw:wzbhea:spi2007302
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/47434/1/535046014.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Beate Sander & Rito Bergemann, 2003. "Economic burden of obesity and its complications in Germany," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 4(4), pages 248-253, December.
    2. Michael Lechner & Rosalia Vazquez-Alvarez, 2003. "The Effect of Disability on Labour Market Outcomes in Germany: Evidence from Matching," University of St. Gallen Department of Economics working paper series 2003 2003-20, Department of Economics, University of St. Gallen.
    3. O'Donoghue, Ted & Rabin, Matthew, 2006. "Optimal sin taxes," Journal of Public Economics, Elsevier, vol. 90(10-11), pages 1825-1849, November.
    4. Schaffner, Sandra & Spengler, Hannes, 2005. "Der Einfluss unbeobachteter Heterogenität auf kompensatorische Lohndifferentiale und den Wert eines statistischen Lebens: Eine mikroökonometrische Parallelanalyse mit IABS und SOEP," Darmstadt Discussion Papers in Economics 152, Darmstadt University of Technology, Department of Law and Economics.
    5. John Cawley & Markus M. Grabka & Dean R. Lillard, 2005. "A Comparison of the Relationship between Obesity and Earnings in the U.S. and Germany," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 125(1), pages 119-129.
    6. Marc Suhrcke & Dieter Urban, 2010. "Are cardiovascular diseases bad for economic growth?," Health Economics, John Wiley & Sons, Ltd., vol. 19(12), pages 1478-1496, December.
    7. David M. Cutler & Edward L. Glaeser & Jesse M. Shapiro, 2003. "Why Have Americans Become More Obese?," Journal of Economic Perspectives, American Economic Association, vol. 17(3), pages 93-118, Summer.
    8. Laurie J. Goldsmith & Brian Hutchison & Jeremiah Hurley, 2006. "Economic Evaluation Across the Four Faces of Prevention: A Canadian Perspective," Centre for Health Economics and Policy Analysis Working Paper Series 2006-01, Centre for Health Economics and Policy Analysis (CHEPA), McMaster University, Hamilton, Canada.
    9. Mishan, E J, 1971. "Evaluation of Life and Limb: A Theoretical Approach," Journal of Political Economy, University of Chicago Press, vol. 79(4), pages 687-705, July-Aug..
    10. repec:dau:papers:123456789/3881 is not listed on IDEAS
    11. 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.
    12. Goldman Dana P & Cutler David M & Shang Baoping & Joyce Geoffrey F, 2006. "The Value of Elderly Disease Prevention," Forum for Health Economics & Policy, De Gruyter, vol. 9(2), pages 1-29, January.
    13. Brigitte Dormont & Michel Grignon & Hélène Huber, 2006. "Health expenditure growth: reassessing the threat of ageing," Health Economics, John Wiley & Sons, Ltd., vol. 15(9), pages 947-963.
    14. repec:aph:ajpbhl:10.2105/ajph.2004.054973_3 is not listed on IDEAS
    15. Sikandar Siddiqui, 1997. "The impact of health on retirement behaviour: empirical evidence from West Germany," Health Economics, John Wiley & Sons, Ltd., vol. 6(4), pages 425-438.
    16. Xavier Sala-I-Martin & Gernot Doppelhofer & Ronald I. Miller, 2004. "Determinants of Long-Term Growth: A Bayesian Averaging of Classical Estimates (BACE) Approach," American Economic Review, American Economic Association, vol. 94(4), pages 813-835, September.
    17. repec:aph:ajpbhl:1997:87:5:755-759_9 is not listed on IDEAS
    18. Joaquim Oliveira Martins & Frédéric Gonand & Pablo Antolín & Christine de la Maisonneuve & Kwang-Yeol Yoo, 2005. "The Impact of Ageing on Demand, Factor Markets and Growth," OECD Economics Department Working Papers 420, OECD Publishing.
    19. Schmidhuber, Josef, 2004. "The Growing Global Obesity Problem: Some Policy Options to Address It," eJADE: electronic Journal of Agricultural and Development Economics, Food and Agriculture Organization, Agricultural and Development Economics Division, vol. 1(2).
    Full references (including those not matched with items on IDEAS)

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:wzbhea:spi2007302. 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: (ZBW - German National Library of Economics). General contact details of provider: http://edirc.repec.org/data/wzbbbde.html .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.