http://repub.eur.nl/res/concept/jel-I18/ Recent publications classified by JEL Code I18 en http://repub.eur.nl/static-eur/img/logo.png http://repub.eur.nl http://repub.eur.nl/res/pub/38749/ 2013-01-17T00:00:00Z When public long-term care (LTC) insurance is provided by insurers, they typically lack incentives for purchasing cost-effective LTC. Providing insurers with appropriate incentives for efficiency without jeopardizing access for high-risk individuals requires, among other things, an adequate system of risk adjustment. While risk adjustment is now widely adopted in health insurance, it is unclear whether adequate risk adjustment is feasible for LTC because of its specific features. We examine the feasibility of risk adjustment for LTC insurance using a rich set of linked nationwide Dutch administrative data. Prior LTC use and demographic information are found to explain much of the variation, while prior health care expenditures are important in reducing predicted losses for subgroups of health care users. Nevertheless, incentives for risk selection against some easily identifiable subgroups persist. Moreover, using prior utilization and expenditure as risk adjusters dilutes incentives for efficiency, but using multiyear data may reduce this disadvantage. Bakx, P. Schut, F.T. Doorslaer, E.K.A. van http://repub.eur.nl/res/pub/37225/ 2012-09-04T00:00:00Z This article explores the determinants of road traffic crash fatalities in India. In addition to income, the analysis considers the sociodemographic population structure, motorization levels, road and health infrastructure and road rule enforcement as potential factors. An original panel data set covering 25 Indian states is analyzed using multivariate regression analysis. Time and state fixed-effects account for unobserved heterogeneity across states and time. The rising motorization, urbanization and accompanying increase in the share of vulnerable road users, that is, pedestrians and two-wheelers, are the major drivers of road traffic crash fatalities in India. Among vulnerable road users, women form a particularly high-risk group. Higher expenditure per police officer is associated with a lower fatality rate. The results suggest that India should focus, in particular, on road infrastructure investments that allow the separation of vulnerable from other road users on improved road rule enforcement and should pay special attention to vulnerable female road users. Grimm, M. Treibich, C. http://repub.eur.nl/res/pub/30602/ 2011-11-01T00:00:00Z Public providers have no financial incentive to respect their legal obligation to exempt the poor from user fees. Health Equity Funds (HEFs) aim to make exemptions effective by giving NGOs responsibility for assessing eligibility and compensating providers for lost revenue. We use the geographic spread of HEFs in Cambodia to identify their impact on out-of-pocket (OOP) payments. Among households with some OOP payment, HEFs reduce the amount by 29%, on average. The effect is larger for households that are poorer, mainly use public health care and live closer to a district hospital. HEFs are more effective in reducing OOP payments when they are operated by a NGO, rather than the government, and when they operate in conjunction with the contracting of public health services. HEFs reduce households' health-related debt by around 25%, on average. There is no significant impact on non-medical consumption and health care utilisation. Flores, G. Por, I. Men, C.R. O'Donnell, O.A. Doorslaer, E.K.A. van http://repub.eur.nl/res/pub/25710/ 2011-08-01T00:00:00Z This paper examines the impact of coinsurance exemption for prescription medicines applied to elderly individuals in Spain after retirement. To evaluate this coinsurance change we use a rich administrative dataset that links pharmaceutical consumption and hospital discharge records for the full population aged 58 to 65 in January 2004 covered by the public insurer in a Spanish region and we follow them until December 2006. We use a difference-in-differences strategy and exploit the eligibility age for Social Security to control for the endogeneity of the retirement decision. Our most conservative results show that the uniform exemption from pharmaceutical copayment granted to retired people in Spain increases the consumption of prescription medicines on average by 9.5%, total pharmaceutical expenditure by 15.2% and the costs borne by the insurer by 47.5%, without evidence of any offset effect in the form of reduced hospitalization. The impact is concentrated among individuals who were consumers of medicines for acute and other non-chronic diseases with a previous coinsurance rate in the range 30% to 40%. Puig-Junoy, J. García-Gómez, P. Casado-Marín, D. http://repub.eur.nl/res/pub/34805/ 2011-01-01T00:00:00Z Wagner, N. http://repub.eur.nl/res/pub/19426/ 2010-05-01T00:00:00Z This paper investigates the effects of inequality in health on economic growth in low and middle income countries. The empirical part of the paper uses an original cross-national panel data set covering 62 low and middle income countries over the period 1985 to 2007. I find a substantial and relatively robust negative effect of health inequality on income levels and income growth controlling for life expectancy, country and time fixed-effects and a large number of other effects that have been shown to matter for growth. The effect also holds if health inequality is instrumented to circumvent a potential problem of reverse causality. Hence, increasing access to health care for the poor can make a substantial contribution to economic growth not only through its effect on life expectancy but also through its effect on reduced health inequality. Grimm, M. http://repub.eur.nl/res/pub/23142/ 2010-05-01T00:00:00Z A new method is proposed to assess and improve the performance of risk equalization models in competitive markets for individual health insurance, where compensation is intended for variation in observed expenditures due to so-called S(ubsidy)-type risk factors but not for variation due to other, so-called N(onsubsidy)-type risk factors. Given the availability of a rich subsample of individuals for which normative expenditures, YNORM, can be accurately determined, we make two contributions: (a) any risk equalization scheme applied to the entire population, YREF, should be evaluated through its performance in the subsample, by comparing YREF with YNORM (not by comparing YREF with observed expenditures, Y, in the entire population, as commonly done); (b) conventional risk equalization schemes can be improved by the subsample regression of YNORM, rather than Y, on the risk adjusters that are observable in the entire population. This new method is illustrated by an application to the 2004 Dutch risk equalization model. Stam, P.J.A. Vliet, R.C.J.A. van Ven, W.P.M.M. van de http://repub.eur.nl/res/pub/26886/ 2010-01-01T00:00:00Z The prevalence of overweight and obesity is growing rapidly in many countries. Education policies might be important for reducing this increase. This paper analyses the causal effect of education on the probability of being overweight by using longitudinal data of Australian identical twins. The data include self-reported and clinical measures of body size. Our cross-sectional estimates confirm the well-known negative association between education and the probability of being overweight. For men we find that education also reduces the probability of being overweight within pairs of identical twins. The estimated effect of education on overweight status increases with age. Remarkably, for women we find no negative effect of education on body size when fixed family effects are taken into account. Identical twin sisters who differ in educational attainment do not systematically differ in body size. Peer effects within pairs of identical twin sisters might play a role. Webbink, H.D. Martin, N.G. http://repub.eur.nl/res/pub/18706/ 2009-12-01T00:00:00Z We examine the marginal effects of decentralized public health spending by incorporating estimates of behavioural responses to changes in public health spending through benefit incidence analysis. The analysis is based on a panel dataset of 207 Indonesian districts over a 4-year period from 2001 to 2004. We show that district-level public health spending is largely driven by central government transfers, with an elasticity of public health spending with respect to district revenues of around 0.9. We find a positive effect of public health spending on utilization of outpatient care in the public sector for the poorest two quartiles. We find no evidence that public expenditures crowd oututilization of private services or household health spending. Our analysis suggests that increased public health spending improves targeting to the poor, as behavioural changes in public health care utilization are pro-poor. Nonetheless, most of the benefits of the additional spending accrued to existing users of services, as initial utilization shares outweigh the behavioural responses. Sparrow, R.A. Pradhan, M.P. Kruse, I. http://repub.eur.nl/res/pub/14944/ 2009-02-01T00:00:00Z Rapid urbanization could have positive and negative health effects, such that the net impact on population health is not obvious. It is, however, highly pertinent to the human welfare consequences of development. This paper uses community and individual level longitudinal data from the China Health and Nutrition Survey to estimate the net health impact of China’s unprecedented urbanization. We construct an index of urbanicity from a broad set of community characteristics and define urbanization in terms of movements across the distribution of this index. We use difference-in-differences estimators to identify the treatment effect of urbanization on the self-assessed health of individuals. The results reveal important, and robust, negative causal effects of urbanization on health. Urbanization increases the probability of reporting fair or poor health by 5 to 15 percentage points, with a greater degree of urbanization having larger health effects. While people in more urbanized areas are, on average, in better health than their rural counterparts, the process of urbanization is damaging to health. Our measure of self-assessed health is highly correlated with subsequent mortality and the causal harmful effect of urbanization on health is confirmed using more objective (but also more specific) health indicators, such as physical impairments, disease symptoms and hypertension. Van de Poel, E. O'Donnell, O.A. Doorslaer, E.K.A. van http://repub.eur.nl/res/pub/12340/ 2008-05-15T00:00:00Z Prior marketing literature has overlooked the role of regulatory regimes in explaining international sales growth of new products. This paper addresses this gap in the context of new pharmaceuticals (15 new molecules in 34 countries) and sheds light on the effect regulatory regimes have on new drug sales across the globe. Based on a time-varying coefficient model, we find that differences in regulation substantially contribute to cross-country variation in sales. One of the regulatory constraints investigated, i.e. manufacturer price controls, has a positive effect on drug sales. The other forms of regulation such as restrictions of physician prescription budgets and the prohibition of direct-to-consumer advertising tend to hurt sales. The effect of manufacturer price controls is similar for newly launched and mature drugs. In contrast, regulations on physician prescription budget and direct-to-consumer advertising have a differential effect for newly launched and mature drugs. While the former hurts mature drugs more, the latter has a larger effect on newly launched drugs. In addition to these regulatory effects, we find that national culture, economic wealth, introduction timing, lagged sales and competition, also affect drug sales. Our findings may be used as input by managers for international launch and sales decisions. They may also be used by public policy administrators to compare drug sales in their country to other countries and to assess the role of regulatory regimes therein. Stremersch, S. Lemmens, A. http://repub.eur.nl/res/pub/8409/ 2007-01-11T00:00:00Z Physicians are supposed to serve patients' interests, but some are more inclined to do so than others. This paper studies how the system of health care provision affects the allocation of patients to physicians when physicians differ in altruism. We show that allowing for private provision of health care, parallel to (free) treatment in a National Health Service, benefits all patients. It enables rich patients to obtain higher quality treatment in the private sector. Because the altruistic physicians infer that in their absence, NHS patients receive lower treatment quality than private sector patients, they optimally decide to work in the NHS. Hence, after allowing for private provision, the remaining (relatively poor) NHS patients are more likely to receive the superior treatment provided by altruistic physicians. We also show, however, that allowing physicians to moonlight, i.e. to operate in both the NHS and the private sector simultaneously, nullifies part of these beneficial effects for the poorest patients. Delfgaauw, J. http://repub.eur.nl/res/pub/8074/ 2006-10-09T00:00:00Z Does medical insurance affect health care demand and in the end contribute to improvements in the health status? Evidence for China for the year 2004, by means of the China Health and Nutrition Survey (CHNS), shows that health insurance does not affect health care demand in a significant manner. Counterfactuals suggest that full insurance coverage of the Chinese population will not radically change the health care decisions and may even enlarge the perverse effects of today’s health care system: insured persons are more likely to fall back on self-care when they are injured or ill than on the care of a local clinic. This effect is particularly strong in urban areas. In case of a severe injury hospital consultation is preferred to local clinic or self-care by most people, but still a substantial percentage (20 percent) resorts to self-care or ignores the illness. The high level of out-of-pocket expenses paid by both insured and uninsured patients lies at t! he root of this problem. Insurance does not offer real protection against unpredictable high health care expenditures and can lead people into a position of long-term poverty or serious liquidity problems. Dalen, H.P. van http://repub.eur.nl/res/pub/11627/ 2005-11-01T00:00:00Z This paper develops a model for multi-store competition between firms. Using the fact that different firms have different outlets and produce horizontally differentiated goods, we obtain a pure strategy equilibrium where firms choose a different location for each outlet and firms' locations are interlaced. The location decisions of multi-store firms are completely independent of each other. Firms choose locations that minimize transportation costs of consumers. Moreover, generically, the subgame perfect equilibrium is unique and when the firms have an equal number of outlets, prices are independent of the number of outlets. Janssen, M.C.W. Karamychev, V.A. Reeven, P.A. van http://repub.eur.nl/res/pub/11628/ 2004-11-01T00:00:00Z We study the impact of financial incentives on social approval, showing that in a society with altruists and egoists, who all care about social approval, introducing financial incentives to agents to contribute to a socially desirable outcome may actually decrease the number of contributions. Withdrawing the financial incentive does not restore the norm to contribute and may reduce the level of contributions even further. When the norm has disappeared, it may be possible to restore voluntary contributions by first introducing high price and then reducing it, but such an operation is costly and its success uncertain. Janssen, M.C.W. Mendys, E. http://repub.eur.nl/res/pub/6711/ 2004-01-06T00:00:00Z This paper develops a model for multi-store competition between firms. Using the fact that different firms have different outlets and produce horizontally differentiated goods, we obtain a pure strategy equilibrium where firms choose a different location for each outlet and firms' locations are interlaced. Moreover, generically, the subgame perfect equilibrium is unique and when the firms have an equal number of outlets, prices are independent of the number of outlets. Janssen, M.C.W. Karamychev, V.A. Reeven, P.A. van http://repub.eur.nl/res/pub/6861/ 2001-06-30T00:00:00Z There is increasing empirical and experimental evidence that providing financial incentives to agents to perform certain socially desirable actions may permanently reduce other types of motivations to undertake these actions. We study the impact of financial incentives on the desire for social approval, using the example of blood donation. We show that in a society with altruists and egoists, who all care about social approval, introducing a payment into a voluntary system may actually decrease the amount of blood donated. Withdrawing the financial incentive does not restore the norm to donate and may reduce the supply of blood even further. Janssen, M.C.W. Mendys, E.