Analyzing the Effects of Insuring Health Risks: On the Trade-Off between Short Run Insurance Benefits vs. Long Run Incentive Costs

Cole, Harold L.; Kim, Soojin; Krueger, Dirk

doi:10.2139/ssrn.2183169

Cited by 5 publications

(5 citation statements)

References 32 publications

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“…They then quantitatively evaluate the lifetime consequences of bad health in a structural life-cycle model. Cole et al (2019) study the effect of labor and health insurance market policies on the the evolution of the cross-sectional health distribution. Capatina (2015) quantifies the impact of health status on labor supply, asset accumulation and welfare.…”

Section: Introductionmentioning

confidence: 99%

The evolution of health over the life cycle

Hosseini

Kopecky

Zhao

2022

Review of Economic Dynamics

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We construct a unified objective measure of health status: the frailty index, defined as the cumulative sum of all adverse health indicators observed for an individual. First, we show that the frailty index has several advantages over self-reported health status, particularly when studying health dynamics. Then we estimate a stochastic process for frailty dynamics over the life cycle. We find that the autocovariance structure of frailty in panel data strongly supports a process that allows the conditional variance of frailty shocks to increase with age. Our frailty measure and dynamic process can be used by researchers to study the evolution of health over the life cycle and its economic implications.

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Section: Introductionmentioning

confidence: 99%

The evolution of health over the life cycle

Hosseini

Kopecky

Zhao

2022

Review of Economic Dynamics

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“…xxiv See Ozkan (2014), Fonseca et al (2009), Blau and Gilleskie ( 2008), Pelgrin and St-Amour (2016), Cole et al (2012), Hai (2015, Halliday et al (2017), Hugonnier et al (2012, and Scholz and Seshadri (2016). Outside the economics field, the predominant view is indeed that income causes health rather than vice-versa (see Brunner, 2017, for a recent review).…”

Section: Tablesmentioning

confidence: 99%

The Impact of Health on Labor Supply near Retirement

et al. 2021

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Estimates of how health affects employment vary considerably. We assess how different methods and health measures impact estimates of the impact of health on employment using a unified framework for the US and England. We find that subjective and objective health measures, and subjective measures instrumented by objective measures produce similar estimates when using sufficiently rich objective measures. Moreover, a single health index can capture the relevant health variation for employment. Health deterioration explains up to 15% of the decline in employment between ages 50 and 70. Effects are larger for the US than England, and for the low educated.

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“…Much of the analyses uses SRHS to measure health. For instance, Cole et al (2019) use SRHS to study the effect of labor and health insurance market policies on the evolution of the cross-sectional health distribution. Capatina (2015) use SRHS to calibrate a structural model and quantify the impact of health on labor supply, asset accumulation and welfare.…”

Section: Introductionmentioning

confidence: 99%

Untitled

2021

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We construct a unified objective measure of health status: the frailty index, defined as the cumulative sum of all adverse health indicators observed for an individual. Using the frailty index, we document four stylized facts on health dynamics over the life cycle. We show that the facts are robust to several alternative approaches to the construction of the index. We also compare the frailty index with selfreported health status and find significant differences in their dynamics and ability to predict health-related outcomes. Finally, we propose and estimate a stochastic process for frailty dynamics over the life cycle accounting for mortality bias. Researchers can use our frailty measure and dynamic process to study the evolution of health over the life cycle and its economic implications.

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Analyzing the Effects of Insuring Health Risks: On the Trade-Off between Short Run Insurance Benefits vs. Long Run Incentive Costs

Cited by 5 publications

References 32 publications

The evolution of health over the life cycle

The evolution of health over the life cycle

The Impact of Health on Labor Supply near Retirement

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