Health economics

Thomas Buchmueller, Helen Levy, 10 June 2017

The Affordable Care Act (ACA), enacted in 2010, was intended to address long- standing problems with the American system of health care and health insurance. This column, taken from a new VoxEU eBook, reviews the main provisions of the ACA related to insurance coverage and healthcare costs, including what is known so far about their impact. It also discusses the recent Republican attempt to ‘repeal and replace’ the law.

Margaret Kyle, Heidi Williams, 22 May 2017

Despite higher per capita healthcare spending, US health outcomes compare poorly with other developed nations. One potential reason is that the US healthcare system creates incentives that promote the faster adoption of medical technologies with minimal benefits. This column tests this claim using data on the quality and diffusion of new pharmaceuticals in the US and four other countries. The results suggest that compared to Australia, Canada, Switzerland, and the UK, low-quality drugs diffuse more quickly in the US relative to high-quality drugs.

Joan Costa-i-Font, Sarah Fleche, 01 May 2017

The number of hours the average person sleeps has declined over the past century, yet the effect of sleep deprivation on economic activity and economic performance has received little attention. Using a dataset covering 14,000 families, this column investigates the link between employment outcomes for mothers and quality of sleep, measured by the number of times their children wake up at night. The results suggest that improving mothers’ average nightly duration of sleep has a positive impact on employment rates, number of hours worked, household income, and job satisfaction.

Caterina Alacevich, Alessandro Tarozzi, 23 April 2017

Data typically show that people become progressively taller as living standards improve. But despite impressive recent rates of economic growth, India remains one of the worst-performing countries in terms of height. Using data from Indian and English health surveys, this column reveals that, conditional on parents’ height, children of Indian ethnicity are on average taller when born and raised in England rather than in India. The results provide evidence against the importance of genetic factors in explaining the disappointing growth performance of Indian children.

Mirko Licchetta, Michal Stelmach, 13 April 2017

Population ageing is one of the most commonly cited drivers of rising healthcare spending. However, other non-demographic cost pressures, such as increasing relative health spending and technological advancement, also contribute substantially over the longer term. This column argues that taking these additional factors into account, the UK’s net public debt due to healthcare is projected to be up to twice as large in 2066. These findings stress the importance of balancing the budget as early as possible to keep public finances on a sustainable path.

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