Beliefs, Preferences and Health Insurance Behavior

This thesis contributes to an accumulation of research that uses behavioral economics to provide insights into social issues of substantial policy interest. The main body of the thesis uses data on beliefs, preferences and health insurance behavior collected purposefully for this thesis as part of a nationwide household survey in the Philippines. This data is used to explain the discrepancy between estimates of large potential gains from health insurance in low- and middle-income countries that are derived from standard economic models and low observed take up of voluntary health insurance.
Chapter 2 examines the association of elicited risk preferences defined by prospect theory and time preferences defined by quasi-hyperbolic discounting with health insurance enrollment.
Chapter 3 introduces and applies a new decomposition of the willingness to pay for insurance into its fair price and four behavioral deviations from that price including subjective beliefs of medical expenditure.
Chapter 4 presents an evaluation of the long-term impact of temporary inducements for health insurance enrollment.
Chapter 5 is connected to the others through the focus on belief elicitation. It introduces a new method of identifying and purging subadditivity bias in reported probabilities and applies it using survey data on stock holding behavior.