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The impact of health insurance on households’ financial choices: Evidence from Vietnam

Author

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  • Tuan, Truong Anh
  • Nam, Pham Khanh
  • Loan, Le Thanh

Abstract

This paper investigates the impact of health insurance on families' financial service choices in Vietnam using TVSEP data from three waves in 2013, 2016, and 2017. The endogeneity is handled via a recursive multivariate probit model. The findings indicate that while health insurance has no effect on private health insurance, it has a positive effect on savings and investments and a negative effect on credit choice. The multivariate probit model's results are robust to both the instrumental variable two-stage least squares model and the bivariate probit model. In addition, correlations between error components in financial service choice equations indicate a possible pattern of household financial usage. The results suggest that health insurance improves households' financial well-being. The implication of the findings is that when developing social security policies aimed at achieving universal health insurance, the influence of health insurance on household finances should not be underestimated.

Suggested Citation

  • Tuan, Truong Anh & Nam, Pham Khanh & Loan, Le Thanh, 2022. "The impact of health insurance on households’ financial choices: Evidence from Vietnam," Research in Economics, Elsevier, vol. 76(3), pages 264-276.
    • Handle: RePEc:eee:reecon:v:76:y:2022:i:3:p:264-276
    DOI: 10.1016/j.rie.2022.07.005
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    More about this item

    Keywords

    Impact; Health insurance; Multivariate probit; Financial services;
    All these keywords.

    JEL classification:

    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • G52 - Financial Economics - - Household Finance - - - Insurance

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