Modelling the size, cost and health impacts of universal basic income: what can be done in advance of a trial?

Opposition to Universal Basic Income (UBI) is encapsulated by Martinelli’s claim that ‘an affordable basic income would be inadequate, and an adequate basic income would be unaffordable’. In this article, we present a model of health impact that transforms that assumption. We argue that UBI can affect higher level social determinants of health down to individual determinants of health and on to improvements in public health that lead to a number of economic returns on investment. Given that no trial has been designed and deployed with that impact in mind, we present a methodological framework for assessing prospective costs and returns on investment through modelling to make the case f..

Health Economics

Mass Covid-19 Vaccination and Excess Mortality: Direct and Indirect Pathways

The rollout of Covid-19 vaccinations is unprecedented in pace and scope. Over seven billion doses have been administered to date so aggregate effects should have become apparent. This cross-country panel data study relates weekly estimates of excess mortality to the incidence of Covid-19 vaccinations, for the 32 OECD countries with high frequency excess mortality data available. The correlation between excess mortality and vaccination incidence is decomposed into two pathways: one from vaccination via Covid-attributed deaths to excess mortality and a non-Covid pathway that goes directly from vaccination to excess mortality, with Covid-19 deaths held constant. The non-Covid pathway from vacci..

Health Economics

Modelling life trajectories of body-mass index

Body-mass index (BMI) tends to follow a typical trajectory over the life-course of an individual, increasing in early life while decreasing after middle age. To be able to reflect these trends in the OECD Strategic Public Health Planning for Non-Communicable Diseases (SPHeP-NCDs) model, this paper analyses longitudinal BMI data from 22 countries to build a mixed, autoregressive model predicting an individual’s BMI based on their sex, age and previous BMI. The resulting model shows how young people are likely to see an increase in BMI year-on-year, even if they already have overweight or obesity. It also shows that that a healthy weight in childhood does not protect against future overweigh..

Health Economics

Willingness to pay or willingness to accept? An experimental study on secondhand smoke

The anomaly between willingness to pay (WTP) and willingness to accept (WTA) invokes a well-established discussion in the stated preference literature. The debate involves which of the two is a better welfare measure. Although a few studies have tried to provide some insights, many researchers settle for eliciting WTP rather than WTA. However, WTA is a better welfare measure in some circumstances, especially in situations involving spillover effects and property rights. We investigate one of such situations and provide insights into how individuals in heterogeneous healthcare systems (private (U.S.) and public (U.K.)) value the effects of a spillover. First, we use choice experiments and con..

Health Economics

Multiple Pricing for Health Care Services

This paper provides a theoretical model that captures the essential features of a Swedish health care reform where private and public health care providers serve patients with certain functional impairments, but where only private providers can reject service requests from patients. Since the hourly price compensation is fixed, this type of systems is expected to result in a monetary deficit for public providers (since they can not reject proposals from “unprofitable” patients). This paper proposes a more advanced pricing system and characterizes its optimal solution. A numerical analysis demonstrates that the deficit for the public provider can be substantially reduced without affecting..

Health Economics

Flood Disasters and Health Among the Urban Poor

Billions of people live in urban poverty, with many forced to reside in disaster-prone areas. Research suggests that such disasters harm child nutrition and increase adult morbidity. However, little is known about impacts on mental health, particularly of people living in slums. In this paper we estimate the effects of flood disasters on the mental and physical health of poor adults and children in urban Indonesia. Our data come from the Indonesia Family Life Survey and new surveys of informal settlement residents. We find that urban poor populations experience increases in acute morbidities and depressive symptoms following floods, that the negative mental health effects last longer, and th..

Health Economics

Subjective risk belief function in the field: Evidence from cooking fuel choices and health in India

We investigate the accuracy of the perceptions of health risks in India. The context of our study is the risk of developing physical symptoms related to household air pollution caused by cooking. Using field data collected from 588 respondents in 17 villages in West Bengal, we regress the probability of symptoms on fuel choices to predict respondent-specific health risk changes. The estimated risks, which we treat as objective risks, are then compared with the corresponding subjective probabilistic beliefs, which are elicited by an interactive method with visual aids. Our results show that, on average, the respondents slightly underestimate the change in risk when switching from cooking with..

Health Economics

The career costs of children's health shocks

We provide novel evidence on the impact of a child's health shock on parental labor market outcomes. To identify the causal effect, we leverage long panels of high-quality Finnish and Norwegian administrative data and exploit variation in the timing of the health shock. We do this by comparing parents across families in similar parental and child age cohorts whose children experienced a health shock at different ages. We show that these families have very similar characteristics and were following parallel trends before the event. This allows us to use a simple difference-in-differences model: we construct counterfactuals for treated households with families who experience the same shock a f..

Health Economics

A hard look at soft cost-control measures in healthcare organizations: Evidence from preferred drug policies in Germany

Cost-control interventions that target physicians’ clinical discretion are common in healthcare, but evidence on their efficacy is scarce; in particular for "soft" policies when liability is unlikely to be enforced by the regulator. We study the effectiveness of preferred drug policies (minimum prescription quotas of specific "preferred" drugs) in altering physicians’ practice styles within the high volume drug class of HMG-CoA-reductase inhibitors (statins) in the German statutory health insurance system. Using a nationally representative panel of ambulatory care physicians between 2011 and 2014, we exploit the decentralized institutional setting to estimate physician responses to varia..

Health Economics

Modeling to Inform Economy-Wide Pandemic Policy: Bringing Epidemiologists and Economists Together

Facing unprecedented uncertainty and drastic trade-offs between public health and other forms of human well-being, policy makers during the Covid-19 pandemic have sought the guidance of epidemiologists and economists. Unfortunately, while both groups of scientists use many of the same basic mathematical tools, the models they develop to inform policy tend to rely on different sets of assumptions and, thus, often lead to different policy conclusions. This divergence in policy recommendations can lead to uncertainty and confusion, opening the door to disinformation, distrust of institutions, and politicization of scientific facts. Unfortunately, to date, there have not been widespread efforts ..

Health Economics

The COVID-19 Curtain: Can Past Communist Regimes Explain the Vaccination Divide in Europe?

As of November 2021, all former Communist countries from Central and Eastern Europe exhibit lower vaccination rates than Western European countries. Can institutional inheritance explain, at least in part, this heterogeneity in vaccination decisions across Europe? To study this question we exploit novel data from the second wave of the SHARE (Survey of Health, Ageing, and Retirement in Europe) Covid-19 Survey fielded in Summer 2021 that covers 27 European countries and Israel. First, we document lower Covid-19 vaccine take-up amongst individuals above 55 years old who were born under Communism in Europe. Next, we turn to reunified Germany to get closer to a causal effect of exposure to Iron ..

Health Economics

Administrative border effects in Covid-19 related mortality

Does the organisation of healthcare systems affect health outcomes? To answer this question, we analysed the effects of the Covid-19 pandemic by focusing on mortality rate outcomes and exploited the heterogeneity of the healthcare organisational models among Italian regions, which makes Italy an ideal "laboratory". Within a common national healthcare system, Italian regions are allowed large autonomy to organise themselves as mixed-markets based on choice and competition, network or centralised leadership models, each delivering different responses to the Covid-19 emergency. Exploiting the discontinuity of healthcare organisational models across the Italian regional borders around Lombardy -..

Health Economics

A sound environment: health effects of traffic noise mitigation

This study investigates the health effects of a nationwide program that provided noise mitigation to dwellings. The analysis uses hospitalization records and a difference-in- differences model that compares residents in treated homes to those with similar at- tributes in untreated homes. Results show that noise mitigation measures lower the risk of cardiovascular diseases by 10% after seven years, with effects driven by reduced risk of hypertension. Health effects are larger among the population exposed to higher baseline noise levels. These findings suggest that implementing similar noise mitigation measures will produce meaningful health benefits.

Health Economics

Jabbing the Economy Back to Life?

The pace and scope of Covid-19 vaccination has varied greatly across OECD countries. In this paper, monthly data on vaccination rates for the 32 OECD countries with all-cause mortality rates available are related to seven monthly economic activity indicators: night-time lights and Google Mobility reports for six types of locations. Vaccination rates are also related to Covid response stringency, to Covid cases and deaths, and to all-cause mortality. A standard deviation higher fully vaccinated rate is associated with up to an 0.5 standard deviation larger rise in economic activity over the same month in 2020; an effect due to relaxed response stringency. The partial vaccination rate has no r..

Health Economics

The impact of supply-driven variation in time to death on the demand for health care

Many high-income countries have successfully reduced hospital mortality in several acute health conditions. We test the hypothesis that variation in the supply of care directed to saving the life of individuals with a health shock may result in increasing the demand for health care as individuals are likely to contribute to the demand after surviving the health shock. We examined repeated cross-sections of individuals exposed to an AMI or a stroke over a time window of ten years in Denmark. Hospital survival probabilities in the interval 0- 30 days from the shock are used as an indicator of the supply, while individual health care expenditure in the interval 31-365 days is used as an indicat..

Health Economics

Do patents really foster innovation in the pharmaceutical sector? Results from an evolutionary, agent-based model

The role of the patent system in the pharmaceutical sector is highly debated also due to its strong public health implications. In this paper we develop an evolutionary, agent-based model of the pharmaceutical industry to explore the impact of different configurations of the patent system upon innovation and competition. The model is able to replicate the main stylized facts of the drug industry as emergent properties. We perform policy experiments to assess the impact of different IPR regimes changing the breadth and length of patents. Results suggest that enlarging the extent and duration of patents yields adverse effects in terms of innovation outcomes, as well as of market competition an..

Health Economics

How Do Acquisitions Affect the Mental Health of Employees?

Using employer-employee level data linked to individual health records, we document that the incidence of stress, anxiety, depression, psychiatric medication usage, and even suicide increase following acquisitions. These effects are prevalent among employees from both targets and acquirers, in weak as well as in growing, profitable firms. Employees who experience negative career developments within the merging firms, ’blue-collar’ workers, and employees with lower cognitive and non-cognitive skills are most affected. A variety of tests address endogeneity concerns, including an analysis exploiting failed mergers. Our findings point to mental illness as a significant non-pecuniary cost of..

Health Economics

COVID-19 in long-term care: Impact, policy responses and challenges

The COVID-19 crisis has hit the long-term care (LTC) sector particularly hard, with large numbers of people dependent on care and particularly vulnerable to COVID-19 have fallen ill, and a disproportionate rate of LTC workers both exposed to, and infected by, COVID-19. The analysis presented in this report describes the effects of COVID-19 on LTC in OECD countries, mainly showing infection rates and mortality of LTC recipients. It takes stock of the wide range of policy responses that countries have implemented, detailing the changes over time on testing strategies, reduction of interactions and isolation measures, digitalisation of services, and workforce. The report also assesses emergency..

Health Economics

Information, Belief, and Health Behavior: Evidence from China

Individuals with imperfect information may make suboptimal choices, but providing more information may not effectively improve decision making if the information is not turned into updated belief. We build a Bayesian updating model to illustrate this phenomenon and use a unique Chinese survey that provides data on information shock, belief updating, and corresponding behaviors to test it. We find that when individuals receive signals about their hypertension status, behavioral changes, such as quitting smoking and take medication, are more likely if the new information leads to updated belief. Furthermore, we find heterogeneous effects across subgroups of individuals: Males are more likely t..

Health Economics

Why Do Couples and Singles Save During Retirement?

While the savings of retired singles tend to fall with age, those of retired couples tend to rise. We estimate a rich model of retired singles and couples with bequest motives and uncertain longevity and medical expenses. Our estimates imply that while medical expenses are an important driver of the savings of middle-income singles, bequest motives matter for couples and highincome singles and generate transfers to nonspousal heirs whenever a household member dies. The interaction of medical expenses and bequest motives is a crucial determinant of savings for all retirees. Hence, to understand savings, it is important to model household structure, medical expenses, and bequest motives.

Health Economics

Optimal mixed payment system and medical liability. A laboratory study

In a controlled laboratory environment, we test the role of medical malpractice liability on physicians’ service provision under fee-for-service, capitation, and mixed payment. We find that the introduction of medical liability causes a significant deviation from patient-optimal treatment that it is not mitigated by the use of a standard mixed payment system. Specifically, we find that the presence of medical liability pressure involves a proper optimal calibration of mixed payment system. Our findings have relevant policy implications for the correct calibration and implementation of the mixed payment system.

Health Economics

Gene‐Environment Effects on Female Fertility

Fertility has a strong biological component generally ignored by economists. Using the UK Biobank, we analyze the extent to which genes, proxied by polygenic scores, and the environment, proxied by early exposure to the contraceptive pill diffusion, affect age at first sexual intercourse, age at first birth, completed family size, and childlessness. Both genes and environment exert substantial influences on all outcomes. The anticipation of sexual debut and the postponement of motherhood led by the diffusion of the pill are magnified by gene‐environment interactions, while the decline in family size and the rise in childlessness associated with female emancipation are attenuated by gene‐..

Health Economics

COVID-19, stigma, and habituation: Theory and evidence from mobility data

This paper introduces a habituation effect into the stigma model of self-restraint behavior under the pandemic. The theoretical result indicates that the state of emergency's self-restraint effects weaken with the number of times. In order to confirm whether the results of the theoretical analysis are consistent with the current situation, the empirical analysis examines the impact of emergency declarations on going-out behavior using a prefecture-level daily panel dataset that includes Google's going-out behavior data, the Japanese government's policy interventions based on emergency declarations, and covariates that affect going-out behavior such as precipitation and holidays. The results ..

Health Economics

The Effects of the Covid-19 Pandemic on the Mental Health and Subjective Wellbeing of Workers: An Event Study Based on High-Frequency Panel Data

"Using individual monthly panel data from December 2018 to December 2020, we estimate the impact of the Covid-19 pandemic and two lockdowns on the mental health and subjective well-being of German workers. Employing an event-study design using individual-specific fixed effects, we find that the first and the second wave of the pandemic reduced workers’ mental health substantially. Momentary happiness and life satisfaction also decline in response to Covid-19, but to a smaller extent. We observe adaptation in our study outcomes between waves of the pandemic. This applies to a lesser extent to indicators of well-being in certain areas of life, such as satisfaction with the job and with leisu..

Health Economics

The heterogeneous effects of the Great Recession on informal care to the elderly

This paper studies the role of unobserved factors to measure the impact of the economic downturn on informal care availability to the elderly in Europe. We use the Survey of Health, Ageing and Retirement in Europe (SHARE), which allows controlling for socio-demographic variables. Our results show that the impact of the Great Recession on care receipt depends not only on observed, but also on unobserved characteristics. For 21 percent of the sample, the effect is three to four times larger than the average effect for the entire sample. For 57 percent of the sample, there is no effect of the economic crisis, and this is due to unobservable factors. In our estimation process, we are able to cha..

Health Economics

The effect of COVID-19 and Vaccine rollout on school enrollment in the US

The COVID-19 pandemic outbreaks forced families to decide the safest and most effective learning environments for their children because of the virus's threat to health and life. Hence, because of the nationwide school closure, policymakers have raised concerns about the missing children cases-those who have not enrolled in school at all because of the pandemic. The present study investigates whether there is a difference in the school enrollment during the pre-COVID-19 period, COVID-19 period, and vaccine rollout period. We employed the U.S. Current Population Survey (CPS), covering January 2020 to May 2021, while we use both the logistic and multinomial regression models for the empirical ..

Health Economics

COVID-19 Working Paper: Filling the Pandemic Meal Gap: Disruptions to Child Nutrition Programs and Expansion of Free Meal Sites in the Early Months of the Pandemic

Beginning in March 2020, the Coronavirus (COVID-19) pandemic struck the United States abruptly and unexpectedly, forcing the school and childcare center closures nationwide. These closures disrupted the provision of meals to children through the largest of the U.S. Department of Agriculture’s (USDA) child nutrition programs. In response, USDA issued a series of waivers to facilitate the continued provision of meals to children while prioritizing the health and safety of communities. This study assesses the extent to which the child nutrition infrastructure was able to rapidly adapt to meet the needs of children at the onset of the crisis. It documents disruptions in the provision of meals ..

Health Economics

Elderly Care and Informal Family Care

Informal family care presents important difficulties for the entire economy. Because of short supplies of formal elderly care, some family members are compelled to leave work to provide care for elderly relatives. Therefore, the overall loss of added value caused by informal family care is not negligible. After developing a model to assess how households determine allocation of formal and informal elderly care, we analyze subsidy effects for elderly care in the economy. Results show that subsidies for formal care that is bought by people of the younger generation are more effective for decreasing losses attributable to informal elderly care.

Health Economics

Child Development in the Early Years: Parental Investment and the Changing Dynamics of Different Domains

This paper uses the data on child development collected around the evaluation of a nursery program to estimate the details of the process of human development. We model development as made of three latent factors, reflecting health, cognitive and socio-emotional skills. We observe children from age 1 to age 7. We assume that, at each age, these factors interact among themselves and with a variety of other inputs to determine the level of development at following ages. The richness of the data we use allows us to: (i) let the dynamics be rich and flexible; (ii) let each factors play a role in the production of any other factor; (iii) estimate age-specific functional forms; (iv) treat parental..

Health Economics

Food insecurity, safety nets, and coping strategies during the COVID-19 pandemic: multi-country evidence from sub-saharan Africa

The COVID-19 pandemic has affected food security across the world. As governments respond in different ways both with regards to containing the pandemic and addressing food insecurity, in parallel detailed datasets are being collected and analysed. To date, literature addressing food insecurity during the pandemic, using these datasets, has tended to focus on individual countries. By contrast, this paper provides the first detailed multi-country cross-sectional snapshot of the social dimensions of food insecurity during the COVID-19 pandemic across nine African countries (Chad, Djibouti, Ethiopia, Kenya, Malawi, Mali, Nigeria, South Africa, and Uganda). Econometric analysis reveals that fema..

Health Economics