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Prevention of diseases and preventive co-payment rate

Author

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  • François Maréchal

    (CRESE, University of Franche-Comté (France))

Abstract

In this paper, we use the Rank-Dependent Expected-Utility (RDEU) model to analyse the preventive behaviour of an individual faced with the risk of being sick. The RDEU model makes it possible to take into account the way economic agents perceive the risk of being sick in the future. We first exhibit the condition under which the level of prevention chosen by the agent is higher or lower than the first best level. Then, we determine the optimal level of preventive co-payment rate which implements the first best level of prevention.

Suggested Citation

  • François Maréchal, 2009. "Prevention of diseases and preventive co-payment rate," Economics Bulletin, AccessEcon, vol. 29(3), pages 2333-2342.
    • Handle: RePEc:ebl:ecbull:eb-09-00141
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Prevention; Co-payment rate; Rank-Dependent Expected-Utility;
    All these keywords.

    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty

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