Term
What can economics add to the study of health |
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Definition
- behavioral science
- develop models that can
- predict/explain behavioral patterns
- can be tested with data or experimentation
- underlying assumptions- actors are rational
- firms seek to maximize profit
- people want to maximize utility
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Term
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Definition
- study of decisions in the face of constraints
- how do firms make decisions given market conditions
- how do people make decisions given limited resources
- has predictive nature- given change in constraints, how will people respond
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Term
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Definition
- value of forgone benefit which could be obtained from a resource in its next best alternative use
- must take into account direct and indirect costs (ex: time)
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Term
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Definition
- economics is about making the most efficient use of resources
- efficiency is achieved only by producing/consuming somethin to the poin where the cost of the last unit is no greater than the benefit derived from that unit
- need to access the relative costs and benefits of each marginal addition or reduction in production/ consumption
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Term
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Definition
- assumption- we value our future differently from our past
- a parameter individuals use in estimating the present value of a commodity compared to its value at some point in the future
- value of health gains today compared to value attached to health gains in the future
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Term
Why is understanding discount rate important |
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Definition
- important to understand that people value their future differently and often this changes with age, income, and education
- particularly important in understanding risky behaviors and developing policies that take this concept into account
- we tend to like immediate gratification and so need to take that into account
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Term
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Definition
- definition- action of one party makes another worse/better off, yet the first party does not bear the costs or receive the benefits
- spill over effect- when a person or group external to the transaction derives benefit or harm from the transaction
- examples
- positive- using a condom, deworming, school feedin program, vaccination
- negative- second hand smoke, spread contagious disease by riding public bus, DWI and injuring another, Greenhouse gas
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Term
major results of externalities |
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Definition
- as costs/benefits are born by another person, there is no incentive for the individual indulging in behavior to stop
- understanding of externalities and ability to develop models to show the impact of negative or positive externalities is a major contribution of economists
- how can policy makers use this info to develop appropriate policies?
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Term
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Definition
- defined as good that is non-rivalrous and non excludable
- consumption by one person does not reduce the availability for consumption by others
- theoretical construct
- commodities such as air, environment can be considered as public goods
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Term
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Definition
- definition- measure of sensitivity/responsiveness
- ex: change in demand due to change in price or income
- income elasticity of demand
- price elasticity of demand
- when change in deman is greater than change in price = ELASTIC
- when change in demand is less than change in price = INELASTIC
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Term
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Definition
- one party has better access to info than the other
- esp. true in health care
- doctor knows how to treat condition although patient may not
- patients know their health state beater than insurance company (ex: adverse selection, moral hazard are implications of asymmetric info)
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Term
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Definition
subpopulation taking out insurance is likely to have less favorable characteristics than population in general |
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Term
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Definition
situation where consumers do not bear the direct costs of services and so are encouraged to behave in a way which increases those services |
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Term
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Definition
amount of demand created by doctors, which exists beyond what would have occurred in the market in which consumers are fully informed |
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Term
economic growth effect on health |
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Definition
- improve capacity to purchase food
- adequate sanitation, housing
- increase access to education
- better access to health care info
- increase access to health care and health technology
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Term
effect of poverty on health systems |
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Definition
- high health expenditures can preclude treatment or pose a major financial burden
- especially if individuals have to bear total burden of the costs
- social risk management schemes mostly target the better off leaving poor most vulnerable
- imperfect market and thus role of governments to intervene and provide health
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Term
how does health contribute to greater income |
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Definition
- directly- higher productivity of workers
- indirectly
- increase learning, education
- spillover effects of greater savings and investment
- demographic shift
- health financing policies have an impact on economic performance
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Term
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Definition
sum of consumption, investement, government spendin, and net exports |
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Term
Describe what is ment by welfare gains through risk pooling |
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Definition
- uncertainty exists in terms of adverse health shocks and when they occur- how do you prepare
- people shed risk by purchasing insurance
- much of the structure of health care sector driven by the nature of insurance
- insurance also alters peoples behavior
- risk pooling reduces impact of an adverse health shock
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