The economic benefits of health and prevention in a high-income country: the example of Germany
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.
|Date of creation:||2007|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: ++49 - 30 - 25491 - 0
Fax: ++49 - 30 - 25491 - 684
Web page: http://www.wzb.eu/
More information through EDIRC
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.:
- Cawley, John H. & Grabka, Markus M. & Lillard, Dean R., 2005.
"A Comparison of the Relationship between Obesity and Earnings in the U.S. and Germany,"
EconStor Open Access Articles,
ZBW - German National Library of Economics, pages 119-129.
- 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.
- Huber, Hélène & Grignon, Michel & Dormont, Brigitte, 2006.
"Health expenditure growth : reassessing the threat of ageing,"
Economics Papers from University Paris Dauphine
123456789/3881, Paris Dauphine University.
- 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.
- Brigitte Dormont & Michel Grignon & Hélène Huber, 2006. "Health expenditure growth : reassessing the threat of ageing," Post-Print halshs-00181605, HAL.
- Anne Case & Angela Fertig & Christina Paxson, 2004.
"The Lasting Impact of Childhood Health and Circumstance,"
246, Princeton University, Woodrow Wilson School of Public and International Affairs, Center for Health and Wellbeing..
- 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.
- Gernot Doppelhofer & Ronald I. Miller & Xavier Sala-i-Martin, 2000.
"Determinants of Long-Term Growth: A Bayesian Averaging of Classical Estimates (BACE) Approach,"
NBER Working Papers
7750, National Bureau of Economic Research, Inc.
- 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.
- Gernot Doppelhofer & Ronald I. Miller & Xavier Sala-i-Martin, 2000. "Determinants of Long-Term Growth: A Bayesian Averaging of Classical Estimates (Bace) Approach," OECD Economics Department Working Papers 266, OECD Publishing.
- 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
36800, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute of Economics (VWL).
- Sandra Schaffner & Hannes Spengler, 2005. "Der Einfluss unbeobachteter Heterogenität auf kompensatorische Lohndifferentiale und den Wert eines statistischen Lebens: eine mikroökonometrische Parallelanalyse mit IABS und SOEP," Discussion Papers of DIW Berlin 539, DIW Berlin, German Institute for Economic Research.
- David M. Cutler & Edward L. Glaeser & Jesse M. Shapiro, 2003.
"Why Have Americans Become More Obese?,"
Harvard Institute of Economic Research Working Papers
1994, Harvard - Institute of Economic Research.
- Shapiro, Jesse & Glaeser, Edward & Cutler, David, 2003. "Why Have Americans Become More Obese," Scholarly Articles 2640583, Harvard University Department of Economics.
- David Cutler & Edward Glaeser & Jesse Shapiro, 2003. "Why Have Americans Become More Obese?," NBER Working Papers 9446, National Bureau of Economic Research, Inc.
- Marc Suhrcke & Dieter M. Urban, 2006.
"Are Cardiovascular Diseases Bad for Economic Growth?,"
CESifo Working Paper Series
1845, CESifo Group Munich.
- 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.
- Lechner, Michael & Vazquez-Alvarez, Rosalia, 2003.
"The Effect of Disability on Labour Market Outcomes in Germany: Evidence from Matching,"
IZA Discussion Papers
967, Institute for the Study of Labor (IZA).
- Lechner, Michael & Vazquez-Alvarez, Rosalia, 2004. "The Effect of Disability on Labour Market Outcomes in Germany: Evidence from Matching," CEPR Discussion Papers 4223, C.E.P.R. Discussion Papers.
- 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.
- Beate Sander & Rito Bergemann, 2003. "Economic burden of obesity and its complications in Germany," The European Journal of Health Economics, Springer, vol. 4(4), pages 248-253, December.
- 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.
- 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.
- Oliveira Martins, Joaquim & Gonand, Frédéric & Antolín, Pablo & de la Maisonneuve, Christine & Yoo, Kwang-Yeol, 2005. "The Impact of Ageing on Demand, Factor Markets and Growth," Economics Papers from University Paris Dauphine 123456789/11049, Paris Dauphine University.
- 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).
- O'Donoghue, Ted & Rabin, Matthew, 2006.
"Optimal sin taxes,"
Journal of Public Economics,
Elsevier, vol. 90(10-11), pages 1825-1849, November.
- 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..
- 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.
- 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.
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)
If references are entirely missing, you can add them using this form.