The Lifetime Costs of Bad Health

Nardi, Mariacristina De; Pashchenko, Svetlana; Porapakkarm, Ponpoje

doi:10.3386/w23963

Cited by 38 publications

(20 citation statements)

References 2 publications

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“…We found relatively little evidence against the assumption of a single health index in our reduced form analysis, and this finding supports the use of a single index in structural models. In fact, the vast majority of life cycle models that account for health consider only a single health index (see French, 2005;French and Jones, 2011;French et al, 2018;Braun et al, 2015;De Nardi et al, 2017;Pashchenko and Porapakkarm, 2013;Aizawa and Fu, 2017, as well as the references in Footnote 24. Exceptions include Capatina et al, 2018, andGustman andSteinmeier, 2014).…”

Section: Using the Reduced Form Regressions To Assess Structural Models Of Healthmentioning

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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Section: Using the Reduced Form Regressions To Assess Structural Models Of Healthmentioning

confidence: 99%

The Impact of Health on Labor Supply near Retirement

et al. 2021

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“…Recently, Autor et al (2019) and Lee (2019) noted that households respond to a breadwinner's bad health event by adjusting the spousal labor supply, implying that the welfare consequences of bad health go beyond the individual. On an aggregate level, De Nardi et al (2018) document how poor health outcomes accumulate over the life cycle and shape economic inequality in the United States. Our analysis quantifies the interplay between the effects of occupation-level characteristics and poor health on the labor supply decisions of individuals.…”

Section: A Related Literaturementioning

confidence: 99%

Disability and Occupational Labor Transitions: Evidence from South Korea

Rhee

2020

SSRN Journal

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“…This medical expenses source of risk cannot be isolated using an empirical strategy that involves regressing the change in consumption on the change in health. While separate regressions can be run with earnings and medical expenditures as dependent variables, and this has sometimes revealed that loss of earnings is the greatest health-related economic risk (Di Nardi et al, 2017) even in environments with little or no formal health insurance (Gertler and Gruber, 2002), this does not tell us anything specific about informal insurance of medical expense specifically. 8 A metric that informs of exposure to medical expenditure risk exclusively is required.…”

Section: Consumption Smoothing Over Health Shocksmentioning

confidence: 99%

“…Only then will the cross-section distribution conditional on observable covariates be indicative of the distribution faced by any one household with those characteristics. This assumption is inconsistent with the dynamics of health and medical expenses, which are characterized by persistence and strong serial correlation arising from the chronic nature of many diseases (Feenberg and Skinner, 1994;French and Jones, 2004;Di Nardi et al, 2017). Calculation of a risk premium also requires making assumptions about preferences.…”

Section: Catastrophic Paymentsmentioning

confidence: 99%

Financial Protection Against Medical Expense

O’Donnell¹

2019

Oxford Research Encyclopedia of Economics and Finance

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Financial protection is claimed to be an important objective of health policy. Yet there is a lack of clarity about what it is and no consensus on how to measure it. This impedes the design of efficient and equitable health financing. Arguably, the objective of financial protection is to shield nonmedical consumption from the cost of healthcare. The instruments are formal health insurance and public finances, as well as informal and self-insurance mechanisms that do not impair earnings potential. There are four main approaches to the measurement of financial protection: the extent of consumption smoothing over health shocks, the risk premium (willingness to pay in excess of a fair premium) to cover uninsured medical expenses, catastrophic healthcare payments, and impoverishing healthcare payments. The first of these does not restrict attention to medical expenses, which limits its relevance to health financing policy. The second rests on assumptions about risk preferences. No measure treats medical expenses that are financed through informal insurance and self-insurance instruments in an entirely satisfactory way. By ignoring these sources of imperfect insurance, the catastrophic payments measure overstates the impact of out-of-pocket medical expenses on living standards, while the impoverishment measure does not credibly identify poverty caused by them. It is better thought of as a correction to the measurement of poverty.

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The Lifetime Costs of Bad Health

Abstract: NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

Cited by 38 publications

References 2 publications

The Impact of Health on Labor Supply near Retirement

The Impact of Health on Labor Supply near Retirement

Disability and Occupational Labor Transitions: Evidence from South Korea

Financial Protection Against Medical Expense

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