An extension of the Blinder–Oaxaca decomposition to a continuum of comparison groups

This paper proposes an extension of the Blinder–Oaxaca decomposition from two to a continuum of comparison groups. The proposed decomposition is then estimated for racial wage differences in urban Peru, exploiting a novel data set that allows the capturing of different degrees of mestizaje (racial mixtures).     

Networks or neighborhoods? Correlations in the use of publicly-funded maternity care in California

This study focuses on “network effects” in the utilization of publicly-funded prenatal care using Vital Statistics data from California for 1989-2000. Networks are defined using 5-digit zip codes and a woman's racial or ethnic group. Like others, we find evidence that the use of public programs is highly correlated within groups defined using race/ethnicity and neighborhoods. These correlations persist even when we control for many unobserved characteristics by including zip code-year fixed effects, and when we focus on the interaction between own group behavior and measures of the potential for contacts with other members of the group (“contact availability”). However, the richness of our data allows us to go further and to conduct several tests of one important hypothesis about networks: that the estimated effects represent information sharing within groups. The results cast doubt on the idea that the observed correlations can be interpreted as evidence of information sharing. In particular, we find estimated effects to be as large or larger among women who have previously used the program as among first-time users.     

Supplementary private health insurance and health care utilization of people aged 50+

Does supplementary private health insurance (PHI) coverage influence health care utilization in countries where the coverage ratio with public health insurance is high? I estimate this effect using the Survey of Health, Ageing and Retirement in Europe. Handling the potential endogeneity of supplementary insurance coverage and the large fraction of zero observations in the utilization models influences the empirical results. I show that the effect of PHI coverage on inpatient and outpatient care utilization is not trivial even in countries with generous public health funding. The main finding is that supplementary PHI coverage increases dental care utilization, but decreases the visits to general practitioners. Private insurance is estimated to have little and insignificant influence on the utilization of inpatient care and outpatient specialist care. The magnitude of the effect of supplementary PHI on health care utilization varies with the characteristics of the health care systems.     

The Role of Environmental Management in Consumers Preferences for Corporate Social Responsibility

Consumers in modern societies are increasingly sensitive to environmental performance by large and small corporations, making it a crucial issue in the overall policy of corporate social responsibility. The objective of this paper is to study the role of environmental performance in the profile of corporate social responsibility as perceived by consumers. We utilize a stated preference approach to the study of consumer’s preferences. This approach allows for the evaluation in monetary terms of the trade-offs that individuals can make between various aspects of corporate policy decisions, including the extent of environmental performance. The data is modelled by means of a mixture heuristics approach that allows us to study the utilization of various decision rules in the choice of products with various degrees of environmental performance. The results show that the linear compensatory heuristic is the most extended across individuals and these subjects value most the policies concerned with environmental management. Those subjects opting for the non-compensatory decision rule tend to focus on the attribute of good labour relations as the most salient factor defining corporate social responsibility. In addition, policy measures are relatively more valued for some products rather than for others, suggesting that consumers discriminate between products when valuing companies’ environmental profiles.     

Productivity Dynamics with Technology Choice: An Application to Automobile Assembly

During the 1980's, all Japanese automobile producers opened assembly plants in North America. Industry analysts and previous research claim that these transplants are more productive than incumbent plants and that they produce with a substantially different production process. I compare the production processes by estimating a model that allows for heterogeneity in technology and productivity, both of which are intrinsically unobservable. The model is estimated on a panel of assembly plants, controlling for capacity utilization and price effects.
The results indicate that the more recent technology uses capital more intensively and it has a higher elasticity of substitution between labour and capital. Hicks-neutral productivity growth is estimated to be lower, while capital-biased (labour-saving) productivity growth is higher for the new technology. Using the estimation results, I decompose industry-wide productivity growth and find plant-level changes in lean plants to be the most important contributor. Plant-level productivity growth is further decomposed to reveal the importance of capital-biased productivity growth, increases in the capital–labour ratio, and returns to scale.     

Annual patient and caregiver burden of oncology clinic visits for granulocyte-colony stimulating factor therapy in the US

Objective:

Prophylactic treatment with granulocyte-colony stimulating factors (G-CSFs) is indicated for chemotherapy patients with a significant risk of febrile neutropenia. This study estimates the annual economic burden on patients and caregivers of clinic visits for prophylactic G-CSF injections in the US.

Methods:

Annual clinic visits for prophylactic G-CSF injections (all cancers) were estimated from national cancer incidence, chemotherapy treatment and G-CSF utilization data, and G-CSF sales and pricing information. Patient travel times, plus time spent in the clinic, were estimated from patient survey responses collected during a large prospective cohort study (the Prospective Study of the Relationship between Chemotherapy Dose Intensity and Mortality in Early-Stage (I–III) Breast Cancer Patients). Economic models were created to estimate travel costs, patient co-pays and the economic value of time spent by patients and caregivers in G-CSF clinic visits.

Results:

Estimated total clinic visits for prophylactic G-CSF injections in the US were 1.713 million for 2015. Mean (SD) travel time per visit was 62 (50) min; mean (SD) time in the clinic was 41 (68) min. Total annual time for travel to and from the clinic, plus time at the clinic, is estimated at 4.9 million hours, with patient and caregiver time valued at $91.8 million ($228 per patient). The estimated cumulative annual travel distance for G-CSF visits is 60.2 million miles, with a total transportation cost of $28.9 million ($72 per patient). Estimated patient co-pays were $61.1 million, ～$36 per visit, $152 per patient. The total yearly economic impact on patients and caregivers is $182 million, ～$450 per patient.

Limitations:

Data to support model parameters were limited. Study estimates are sensitive to the assumptions used.

Conclusions:

The burden of clinic visits for G-CSF therapy is a significant addition to the total economic burden borne by cancer patients and their families.     

Modelling Sri Lankan consumption patterns using error corrected LA-AIDS

Static-demand systems used in empirical studies are based on the assumption that consumers immediately and fully adjust to a new equilibrium when either incomes or prices change. In reality, consumers are unlikely to have adjusted to equilibrium in each time period and the assumption of instantaneous adjustments by consumers is potentially incorrect. The dynamic modelling approach allows for intertemporal rationality of consumer behaviour by explicitly considering the mechanism underlying the short-run adjustment process. This study, while considering the traditional static Almost Ideal Demand System (AIDS), in addition, considers two dynamic versions of the AIDS to model the dynamic behaviour of Sri Lankan consumers in consuming eight broad commodity groups using data during the period 1963–2016. The estimated results indicate that all commodities have price inelastic demand in both the short and long run. The differences between short- and long-run demand elasticities indicate the need to adopt a dynamic approach in estimating demand elasticities, because the income and price elasticities are key inputs for policy analysis in economy-wide modelling.     

HMO plans,self-selection and utilization of health care services

This study examines the effect of health maintenance organizations (HMOs) on the use of health care services among the privately insured, nonelderly population. To consider jointly the possible self-selection bias and high frequency of zero observations in the applied utilization measures, we accommodate the endogeneity of health plan choice decisions in the censored regression model. Using data from the 2000 Medical Expenditure Panel Survey, we find strong evidence for favourable self-selection into HMO plans. Health maintenance organization enrollment is found to encourage greater use of office-based and hospital outpatient services. Overall satisfaction with the quality of care among HMO members is relatively low compared to that among nonHMO members. These findings suggest that more effort is needed to develop management strategies in HMOs in order to contain the moral hazard in utilization and assure the quality of service provided within the network of HMO providers.     

Prenatal care: Mechanisms and impacts on infant health and health care utilization

We estimate that prenatal care has positive impacts on health measured at birth, shifts the distribution of future health care utilization away from inpatient care, and find that some of these impacts likely come from an informational mechanism. We also find well child visits are used in a complementary fashion with emergency department care in the production of infant health, suggesting that factors beyond barriers to access may drive the demand for emergency care. Finally, we find differential impacts of prenatal care across racial groups with evidence that the information mechanism may be particularly important for black mothers.     

An empirical analysis of ‘acting white’

Using a newly available data set, which allows one to construct a novel measure of a student's social status, we demonstrate that there are potentially important racial differences in the relationship between social status and academic achievement. The effect is concentrated among students with a grade point average (GPA) of 3.5 or higher and more pronounced in schools with more interracial contact. Earlier studies showing a positive relationship between popularity and academic achievement for blacks are sensitive to the inclusion of more continuous achievement measures. We argue that the data are most consistent with a model of ‘acting white’ in which investments in education are taken as a signal of one's opportunity costs of peer-group loyalty, though imprecise estimates make definitive conclusions difficult.     

Healthcare utilization and costs associated with COPD among SEER-Medicare beneficiaries with NSCLC

Aim: To estimate the healthcare utilization and costs in elderly lung cancer patients with and without pre-existing chronic obstructive pulmonary disease (COPD).

Methods: Using Surveillance, Epidemiology and End Results (SEER)-Medicare data, this study identified patients with lung cancer between 2006–2010, at least 66 years of age, and continuously enrolled in Medicare Parts A and B in the 12 months prior to cancer diagnosis. The diagnosis of pre-existing COPD in lung cancer patients was identified using ICD-9 codes. Healthcare utilization and costs were categorized as inpatient hospitalizations, skilled nursing facility (SNF) use, physician office visits, ER visits, and outpatient encounters for every stage of lung cancer. The adjusted analysis was performed using a generalized linear model for healthcare costs and a negative binomial model for healthcare utilization.

Results: Inpatient admissions in the COPD group increased for each stage of non-small cell lung cancer (NSCLC) compared to the non-COPD group per 100 person-months (Stage I: 14.67 vs 9.49 stays, p?<?.0001; Stage II: 14.13 vs 10.78 stays, p?<?.0001; Stage III: 28.31 vs 18.91 stays, p?<?.0001; Stage IV: 49.5 vs 31.24 stays, p?<?.0001). A similar trend was observed for outpatient visits, with an increase in utilization among the COPD group (Stage I: 1136.04 vs 796 visits, p?<?.0001; Stage II: 1325.12 vs 983.26 visits, p?<?.0001; Stage III: 2025.47 vs 1656.64 visits, p?<?.0001; Stage IV: 2825.73 vs 2422.26 visits, p?<?.0001). Total direct costs per person-month in patients with pre-existing COPD were significantly higher than the non-COPD group across all services ($54,799.16 vs $41,862.91). Outpatient visits represented the largest cost category across all services in both groups, with higher costs among the COPD group ($41,203 vs $31,140.08).

Conclusion: Healthcare utilization and costs among lung cancer patients with pre-existing COPD was ～2–3-times higher than the non-COPD group.     

Evaluating mobile number portability policy in the Thai mobile telecommunications market

Mobile number portability (MNP), which allows consumers to retain their mobile numbers when switching service providers, is expected to promote competition by lowering switching costs. This paper estimates switching costs and switching costs reduction from the MNP policy in Thailand using the mixed logit model with preference heterogeneity on a nationwide survey of mobile telecommunications service usages. The estimation result shows that the MNP policy reduces switching costs by 37% on average and that this benefit is heterogeneous across consumers. The considerable and persistent switching costs call for additional measures to facilitate switching.     

Advertising,learning, and consumer choice in experience good markets: an empirical examination*

This article empirically analyzes different effects of advertising in a nondurable, experience good market. A dynamic learning model of consumer behavior is presented in which I allow both “informative” effects of advertising and “prestige” or “image” effects of advertising. This learning model is estimated using consumer level panel data tracking grocery purchases and advertising exposures over time. Empirical results suggest that in this market, advertising's primary effect was that of informing consumers. The estimates are used to quantify the value of this information to consumers and evaluate the welfare implications of an alternative advertising regulatory regime.     

Private consumption behaviour, liquidity constraints and financial deregulation in France: a nonlinear analysis

This paper examines the effect of financial deregulation on consumption expenditure in France during the period 1970–1993. A nonlinear model for consumption which allows for liquidity constraints through a time-varying parameter dependent on a proxy for financial deregulation is estimated using nonlinear instrumental variables. It is concluded that in France financial deregulation has significantly reduced liquidity constraints faced by consumers, allowing a higher percentage of the population to smooth consumption over time. Evidence is also provided that the intertemporal elasticity of substitution is not significantly different from zero at conventional nominal levels of significance. First version received: January 1997/final version received: May 1999     

Time inconsistency and alcohol sales restrictions

Restrictions on alcohol sales hours or days are commonly used tools in order to reduce alcohol consumption. However, a forward-looking consumer can buy in advance, and thereby mostly undo the impact of the restriction. I study whether time inconsistent consumer preferences can provide a justification for restrictions on alcohol sales time. I estimate a demand model, which allows a fraction of consumers to be time inconsistent, using scanner data of beer purchases and other shopping behavior. According to the estimation results, 16% of regular beer buyers, or only 3% of all consumers, behave as if they are time inconsistent. I find that in terms of consumer welfare, the sales restriction may be welfare improving, but is worse than increasing taxes.     

RACIAL PROFILING OR RACIST POLICING? BOUNDS TESTS IN AGGREGATE DATA*

State‐wide reports on police traffic stops and searches summarize very large populations, making them potentially powerful tools for identifying racial bias, particularly when statistics on search outcomes are included. But when the reported statistics conflate searches involving different levels of police discretion, standard tests for racial bias are not applicable. This article develops a model of police search decisions that allows for nondiscretionary searches and derives tests for racial bias in data that mix different search types. Our tests reject unbiased policing as an explanation of the disparate impact of motor‐vehicle searches on minorities in Missouri.     

UNDERSTANDING MEASURES OF NONMARITAL FERTILITY: THE ROLES OF MARRIAGE AND ACCESS TO HUMAN CAPITAL

This paper proposes an explanation for several decades of rising U.S. nonmarital birth rates and shares, and for cross‐sectional differences in black‐white fertility. Significantly, the explanation does not rely on changes over time or differences across races in individual fertility behavior. It is consistent with the rising nonmarital fertility measures observed in the United States since the mid‐1970s, higher measured fertility for unmarried blacks than whites, and differences across races in the timing of childbearing, despite nearly constant total fertility rates and increasingly similar target family sizes for blacks and whites. The explanation relies on a selection effect associated with changes in the marriage rate and on racial differences in access to human capital investment opportunities. We find strong support for the explanation using U.S. data over the period 1957–2002. Our findings suggest caution in interpreting the results of empirical studies of childbearing that examine marital and nonmarital fertility rates separately, as these studies typically ignore the selection effect of marriage. (JEL J12, J13, I38)     

Individual needs and social pressure: Evidence on the Easterlin hypothesis using repeated cross-section surveys of Canadian households

This paper provides additional evidence, using time-series and cross-sectional Canadian survey data, for the Easterlin hypothesis of an important income elasticity of individual needs. Our analysis is based on the regression of a minimum income to satisfy needs equation derived from a simple utility maximization framework. Moreover, our specification allows computing the Arrow-Pratt relative risk-aversion index and the Intertemporal Rate of Substitution. Our results are robust to different estimation methods dealing with the endogenous nature of income. We also compute poverty rates using our estimated equation parameters and standard OECD measures of poverty and find that some subjective measures are relatively close to the OECD measures.     

Return, purchase, or skip? Outcome, duration, and consumer behavior in the rent-to-own market

Rent-to-own (RTO) is attractive to financially distressed consumers. It allows immediate access to merchandise and an opportunity for eventually acquisition. Yet goods can be returned at any point without penalty or other adverse consequences. We use a competing risk methodology that accounts for unobserved consumer heterogeneity to study how contracts conclude, estimating the probabilities of exit??via return, purchase, or skip??and the associated durations. The estimated outcome probabilities highlight the use of the embedded return option by RTO consumers and the trade-offs and cross-subsidization implicit in the RTO contractual arrangement. We offer rational and behavioral explanations of consumer behavior in the RTO market, which we believe can be generalized to other consumer loan markets.