Paul Contoyannis

The impact of public voluntary health insurance on private health expenditures in Vietnam

As a financing mechanism with the potential to raise additional funds for health services, whilst improving access to services amongst the poor, non-profit health insurance has become increasingly attractive to health policy-makers. Using data from a household survey in Vietnam, out of pocket health expenditure are compared between members and eligible non-members of the government-implemented voluntary health insurance scheme. Expenditures are analysed for individuals who sought care during their most recent illness. Using an endogenous dummy variable model to control for bias resulting from self-selection into the scheme, we find that health insurance reduces average out-of-pocket expenditures by approximately 200%. Whilst income inelastic, health expenditures are found to be significantly influenced by an individuals level of income, irrespective of insurance status. Despite this, insurance reduces expenditures significantly more for the poor than for the rich.

The distribution of health and income: a theoretical framework

A general framework is developed to analyse variations in the distribution of population health, where individual health is modelled as a function of income, conditional upon the level of another factor such as health-related behaviour. Results are derived for the response of the level of average health in a population and the degree of health inequality to alternative health promotion policies and equiproportionate income growth. Qualitative results are shown to depend on characteristics of the individual health production functions and the frequency distribution of the other factor at each income level. These results are independent of the distribution of income. The discussion focuses on the implications of these results for contemporary research into inequalities in health and income.

The Dynamics of Health

Health has long been considered as a fundamental commodity in economic analyses; Michael Grossman (2000) cites Bentham as recognizing that the ‘relief of pain’ is one of the basic arguments in the utility function. Health was viewed both as an investment in human capital and as an output of a household production process by Grossman (1972a & b), the founding father of demand for health models. In the Grossman model, health is both demanded for utility reasons - it is good to feel well - and for investment reasons – to make more healthy time available for market and non-market activities. Grossman developed a dynamic model for health and solution of the dynamic optimisation problem leads to optimal life-cycle health paths, gross investment in each period, consumption of medical care (which is seen as a derived demand) and time inputs in the gross investment function in each period. By comparing maximum lifetime utility for different lengths of life, it also allows endogenous determination of the length of life. Usually the comparative static and dynamic analyses are performed on sub-models where either the consumption benefits are assumed to equal zero (the investment model), or the investment benefits are assumed to equal zero (the consumption model). We focus on the investment model as sharper predictions are available; this model results in a condition which determines the optimal stock of health in any period and shows that the rate of return on capital (or, marginal efficiency of capital, MEC) must equal the opportunity cost of capital. Increases in the depreciation rate over time cause the optimal stock of health to decrease, as the opportunity cost of capital increases. However, if the MEC curve is inelastic, gross investment grows over time. Thus the model predicts older people to have more sick time, to consume more medical care and devote more time to investment

The Role of Child Health and Economic Status in Educational, Health and Labour Market Outcomes in Young Adulthood

The Ontario Child Health Study provides the first opportunity in Canada to assess directly the relationship between socio-economic and health status in childhood and levels of completed schooling, health status, and labour market success in young adulthood. We find that childhood health problems are negatively associated with educational attainment, especially the probability of a university degree, and the health status of young adults. Our results also imply that childhood health problems influence adult labour force outcomes, especially for males, mainly through adult levels of schooling and health.

A SECOND LOOK AT PHARMACEUTICAL SPENDING AS DETERMINANTS OF HEALTH OUTCOMES IN CANADA

Per capita spending on pharmaceutical products has increased substantially in recent decades in Canada. Recent Canadian research by Crémieux et al. concludes that there is a strong statistical relationship between pharmaceutical spending and health outcomes (Health Econ. 2005a; 14: 117, Health Econ. 2005b; 14(2): 107-116). This paper takes a second look at pharmaceutical spending as determinants of health outcomes in Canada. In doing so, it examines the robustness of the findings of Crémieux et al. by considering the appropriateness of the data used and statistical approach utilized. Particular attention is given to the potential for non-stationarity and spurious regression, issues related to unit heterogeneity and the choice of estimators. In contrast with earlier findings, on the whole, no discernable relationship between spending on private or public pharmaceutical products and infant mortality or life expectancy at 65 is observed.

The evolution of health outcomes from childhood to adolescence

Using data from the Canadian National Longitudinal Survey of Children and Youth (NLSCY), this study examines how and why health outcomes exhibit persistence during the period from childhood to adolescence. We examine the distribution of health outcomes and health transitions using descriptive analysis and explore the determinants of these distributions by estimating the contributions of family SES, unobserved heterogeneity and state dependence and also allowing for heterogeneity of state dependence parameters across categories of neighborhood status. Our analysis indicates that children living in poorer neighborhoods, in neighborhoods with lower education levels and in neighborhoods with more families headed by lone-parents tend to experience poor health status for longer after a transition to it, while children tend to experience multiple health drops living in poorer neighborhoods, in neighborhoods with less educated people, in neighborhoods with more families headed by lone-parents and in neighborhoods with more families living in rental accommodation.

Family Socio-economic Status, Childhood Life-events and the Dynamics of Depression from Adolescence to Early Adulthood

This paper employs a conditional quantile regression approach to quantify the dynamics of depression among adolescents, and examine the extent of true state dependence in youth depression conditional on unobserved individual heterogeneity and family socio5economic status. We use data on the children of the US National Longitudinal Survey of Youth 79 cohort (CNLSY79) and employ a recently5developed instrumental variable approach for the estimation of dynamic quantile regression models with fixed effects. Our results suggest that true state dependence in youth depression is very low and the observed positive association between previous depression and current depression is mainly due to time5invariant unobserved individual heterogeneity. The results also show heterogeneity in true state dependence in youth depression across quantiles of the depression distribution.

The Impact of Physical and Sexual Abuse in Childhood on Adult Economic Outcomes: Evidence from the Ontario Child Health Study

In this paper we use data from the Ontario Child Health Study, a community panel study which collected socio-demographic and health information from individuals aged 4-16 in 1983 and which was conducted in three waves (1983, 1987, 2001). A rare property of this survey is that questions were included in 2001 to obtain retrospective reports of physical and sexual abuse in childhood on an ordinal scale. We use this information to examine the neglected topic of the adulthood economic consequences of physical and sexual abuse in childhood. We present descriptive analyses which examine simple and partial correlations between our measures of adult economic outcomes and ordinal measures of abuse. We then estimate single equation regression models for each of our economic outcome variables as a function of the abuse variables and other socioeconomic characteristics. In a third stage we include education variables to examine whether these variables mediate the effects of abuse in childhood to adulthood economic outcomes.