Inadequate Bivariate Measures of Health Inequality: The Impact of Income Distribution*

Bivariate measures of health inequality are influenced by changes in two variables: health and a socioeconomic variable, such as income. For these measures, what is reported as an increase in health inequality might just as well be a reduction in income inequality. In particular, several papers have found that socioeconomic health inequalities in Nordic countries are no less than in other European countries. The correct interpretation could just be that income inequality is no higher in Nordic countries than in the rest of Europe. The problem is especially profound when the causality is running from health to income.     

Health Policy and Equity of Health Care Financing in Australia: 1973–2010

Using data from Australian Taxation Statistics and Household Expenditure Surveys we analyze the distribution of health care financing in Australia over almost four decades. We compute Kakwani Progressivity indices for four sources of health care financing: general taxation, Medicare Levy payments, Medicare Levy Surcharge payments, and direct consumer payments, and estimate the effects of major policy changes on them. The results demonstrate that the first three of these sources of health care financing are progressive in Australia, while the distribution of direct payments is regressive. Surprisingly, we find that neither the introduction of Medicare in Australia in 1984 nor the Extended Medicare Safety Net in 2004 had significant effects on the progressivity of health care financing in Australia. By contrast, the Lifetime Cover scheme—introduced in 2000 to encourage people to buy and hold private health insurance—had a progressive effect on health care financing.     

Cost-Effective Prevention of Hip Fractures

The main objective of the analysis in this article is to do a health economic study of a preventive program that may influence the risk of hip fractures for people age 65 and older. The analysis of health promoting measures aimed at the prevention of hip fractures shows that there is a large potential for reducing costs and achieving significant health benefits within the older groups of the population. Prevention of hip fractures in the best cities seems to be cost-effective because it dominates a situation without any prevention. This implies a reduction in the total costs for society and an improvement in the quality of life and life expectancy.     

Monopoly pricing with negative network effects: The case of vaccines

We study the market for vaccinations considering income heterogeneity on the demand side and monopoly power on the supply side. A monopolist has an incentive to exploit the external effect of vaccinations and leave the poor susceptible in order to increase the willingness to pay the rich. Even the possibility of price discrimination does not remove this incentive. We demonstrate that the weaknesses of standard policy measures are mitigated when income heterogeneity is taken into account. This offers an efficiency based rationale for distribution oriented national or international public health interventions.     

The Inequality of Household Incomes in Australia*

This paper presents income inequality statistics for Australia calculated from the published results of the two official income surveys of 1968-69 and 1973-74. These results suggest firstly that the level of household income inequality in Australia has been previously understated. Secondly, it is noted that there was little, if any, change in inequality over the period. However, when families are classified by number of income earners an unambiguous decline in inequality within these groups occurs. These observations are related to other changes in the economy.     

Household Finances and Social Interaction: Bayesian Analysis of Household Panel Data

We investigate the relationship between social interaction and household finances using the British Household Panel Survey. We explore the relationship between a wide range of aspects of household finances and social interaction, rather than focusing on one particular facet of household finances, such as the holding of stocks and shares. We develop a Bayesian statistical framework to simultaneously explore both sides of the household balance sheet—liabilities and assets. Additionally, we allow the influence of social interaction on household finances to be time dependent, enabling us to model the effects of social interaction from a dynamic perspective. We also develop a two‐part model to jointly investigate the influence of social interaction on the amount of different types of debt and financial assets held conditional on holding the different types of debt and assets. Our analysis suggests that social interaction is associated with households holding larger amounts of debt and assets.     

Transferable Ageing Provisions in Individual Health Insurance Contracts

Abstract. We consider lifetime health insurance contracts in which ageing provisions are used to smooth the premium profile. The capital stock accumulated for each individual can be decomposed into two parts: a premium insurance and an annuitized life insurance, only the latter being transferable between insurers without triggering premium changes through risk segmentation. In a simulation based on German data, the transferable share declines in age and falls with an increasing age of entry into the contract. In spite of different benefit profiles, it is almost identical for women and men.     

The role of low expectations in health and education investment and hazardous consumption

Abstract .  Young people with little 'social or health capital' may be more likely to take up hazardous consumption and shun investments in human capital, raising their likelihood of a 'rags to rags' sequence. First, diminishing marginal utility could raise the marginal benefit of hazardous consumption and the cost of investment. But poor youths may also have lower expectations of future success, independent of the choices they make. Lower expectations of success could reduce the future cost of hazardous consumption and benefit of investment. We test the effect of expectations on decisions to smoke, drink hazardously, exercise, and complete high school, using a longitudinal study of youth in New Zealand. We find that 15-year-olds' expectations of success predict the subsequent onset of smoking, lack of exercise, and failure to complete high school, but not hazardous drinking. While some of the influence of expectations can be explained by low social and health capital, IQ, and other factors, expectations retain a direct effect on smoking and exercise once these other factors are controlled for.     

Childhood preventive care,adult healthcare and economic growth: The role of healthcare financing

We analyze the impact of healthcare financing on economic growth, focusing on the issue of the joint public–private financing of healthcare (co-payment). We use an overlapping-generations model with endogenous growth based on health human capital accumulation, where families pay for childhood preventive care and the government can either fully finance or co-finance adulthood curative care. From a growth maximizing perspective, distortionary taxes give an advantage to co-financing. Nevertheless, we prove that, if agents are assumed to be heterogeneous in preferences, full financing can become the best option.     

Income effects and physician labour supply: evidence from the threshold system in Ontario

Abstract. We examine a reform to the physician threshold system in Ontario that provides a unique opportunity to assess the effect of fee changes on physician behaviour, free from the biases that potentially affect simple time‐series or cross‐section inference. We find that: (1) the income effects of fee changes are small, but significant; (2) the income effect dominates the substitution effect only for a minority of services with relatively low prices and high volumes; and (3) the cross effects of fee changes tend to be significant only for services with relatively high prices and low volumes.     

Party Control of State Government and the Distribution of Public Expenditures*

This paper examines the effects of party control of state governments on the distribution of intergovernmental transfers across counties from 1957 to 1997. We find that the governing parties skew the distribution of funds in favor of areas that provide them with the strongest electoral support. This is borne out in two ways. (i) Counties that traditionally give the highest vote share to the governing party receive larger shares of state transfers to local governments. (ii) When control of the state government changes, the distribution of funds shifts in the direction of the new governing party. We find only weak evidence that parties reward electorally pivotal counties or counties in electorally pivotal legislative districts. Finally, we find that increased spending in a county increases voter turnout in subsequent elections. This suggests that parties have an electoral incentive to skew the distribution of funds to influence future election results, and the mechanism through which this works is “mobilization” rather than “conversion” of voters in a fixed electorate.     

澳大利亚家庭财富的结构与分配

《经济与社会变化的动态研究——澳大利亚家庭收入与就业动态调查之分析》,是一项大型的研究计划。本文只是该计划之下的一个子课题。这项子课题获得澳大利亚研究理事会的资助,(拨款编号为DPO342970)。我们在文中引用的数据,部分来自家庭与社区服务部辖     

The Structure and Distribution of Household Wealth in Australia

This article uses data from the second wave of the Household, Income and Labour Dynamics in Australia (or HILDA) Survey to provide an overview of the structure and distribution of household wealth in Australia. The data confirm that wealth is very unequally distributed, with the bottom half of the distribution owning less than 10 per cent of total household net worth, while the wealthiest 10 per cent account for 45 per cent. The article also includes an analysis of the factors associated with household wealth that indicates that wealth is significantly related to a range of factors including age, country of birth, parental occupational status, education, marital status, working hours, income, self‐reported savings behaviour, a willingness to take risks and even various lifestyle behaviours, such as smoking and alcohol consumption.     

The Indian Public Distribution System as provider of food security: Evidence from child nutrition in Andhra Pradesh

We study whether a sudden increase of the price of rice supplied by the Indian Public Distribution System in Andhra Pradesh, a large Indian state, had a negative impact on child nutrition. A few months after the price increase, a health survey started to record weight for a large sample of children. The data collection continued for several months, so that children measured later lived for a longer period of time in a less favorable price regime. Using different estimation techniques we find that longer exposure to high prices are not accompanied by worse nutritional status, as measured by weight-for-age.     

Quality and quantity in primary care mixed‐payment models: evidence from family health organizations in Ontario

Abstract We study the impact of a mixed capitation model (the Family Health Organization, FHO) on quality and quantity outcomes among primary care physicians in Ontario. Using a panel of administrative data covering one year before and two years after the FHO model was introduced, we find that physicians in the FHO model provide about 6% to 7% fewer services and visits per day, but are between 7% and 11% more likely to achieve preventive care quality targets. These results suggest that the mixed capitation model with contractible quality indicators may be welfare improving relative to the FFS model.     

Hospital Competition and Quality with Regulated Prices*

We analyse the effect of competition on quality in hospital markets with regulated prices, considering the effect of both introducing competition (monopoly versus competition) and increasing competition through either lower transportation costs (increased substitutability) or a higher number of hospitals. With semi‐altruistic providers and a fairly general cost structure, we show that the relationship between competition and quality is generally ambiguous. In contrast to the received body of theoretical literature, this is consistent with, and potentially explains, the mixed empirical evidence.