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Differences in health between Americans and Western Europeans: Effects on longevity and public finance

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  • Michaud, Pierre-Carl
  • Goldman, Dana
  • Lakdawalla, Darius
  • Gailey, Adam
  • Zheng, Yuhui

Abstract

In 1975, 50 year-old Americans could expect to live slightly longer than most of their Western European counterparts. By 2005, American life expectancy had fallen behind that of most Western European countries. We find that this growing longevity gap is primarily due to real declines in the health of near-elderly Americans, relative to their Western European peers. We use a microsimulation approach to project what US longevity would look like, if US health trends approximated those in Western Europe. The model implies that differences in health can explain most of the growing gap in remaining life expectancy. In addition, we quantify the public finance consequences of this deterioration in health. The model predicts that gradually moving American cohorts to the health status enjoyed by Western Europeans could save up to $1.1 trillion in discounted total health expenditures from 2004 to 2050.

Suggested Citation

  • Michaud, Pierre-Carl & Goldman, Dana & Lakdawalla, Darius & Gailey, Adam & Zheng, Yuhui, 2011. "Differences in health between Americans and Western Europeans: Effects on longevity and public finance," Social Science & Medicine, Elsevier, vol. 73(2), pages 254-263, July.
    • Handle: RePEc:eee:socmed:v:73:y:2011:i:2:p:254-263
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    Cited by:

    1. Vincenzo Atella & Federico Belotti & Daejung Kim & Dana Goldman & Tadeja Gracner & Andrea Piano Mortari & Bryan Tysinger, 2021. "The future of the elderly population health status: Filling a knowledge gap," Health Economics, John Wiley & Sons, Ltd., vol. 30(S1), pages 11-29, November.
    2. Chen, Cynthia & Lim, Jue Tao & Chia, Ngee Choon & Wang, Lijia & Tysinger, Bryan & Zissimopoulos, Julie & Chong, Ming Zhe & Wang, Zhe & Koh, Gerald Choon Huat & Yuan, Jian-Min & Tan, Kelvin Bryan & Chi, 2019. "The long-term impact of functional disability on hospitalization spending in Singapore," The Journal of the Economics of Ageing, Elsevier, vol. 14(C).
    3. Raquel Fonseca Benito & Yuhui Zheng, 2011. "The Effect of Education on Health Cross-Country Evidence," Working Papers WR-864, RAND Corporation.
    4. Raquel Fonseca & Pierre-Carl Michaud & Yuhui Zheng, 2020. "The effect of education on health: evidence from national compulsory schooling reforms," SERIEs: Journal of the Spanish Economic Association, Springer;Spanish Economic Association, vol. 11(1), pages 83-103, March.
    5. Datta Gupta, Nabanita & Kleinjans, Kristin J. & Larsen, Mona, 2015. "The effect of a severe health shock on work behavior: Evidence from different health care regimes," Social Science & Medicine, Elsevier, vol. 136, pages 44-51.
    6. Goldman Dana P. & Lakdawalla Darius N. & Baumgardner James R. & Linthicum Mark T., 2016. "Are Biopharmaceutical Budget Caps Good Public Policy?," The Economists' Voice, De Gruyter, vol. 13(1), pages 27-42, December.
    7. Côté-Sergent, Aurelie & Fonseca, Raquel & Strumpf, Erin, 2020. "Comparing the education gradient in health deterioration among the elderly in six OECD countries," Health Policy, Elsevier, vol. 124(3), pages 326-335.
    8. Duncan Ermini Leaf & Bryan Tysinger & Dana P. Goldman & Darius N. Lakdawalla, 2021. "Predicting quantity and quality of life with the Future Elderly Model," Health Economics, John Wiley & Sons, Ltd., vol. 30(S1), pages 52-79, November.
    9. Daniel Bauer & Darius Lakdawalla & Julian Reif, 2018. "Mortality Risk, Insurance, and the Value of Life," NBER Working Papers 25055, National Bureau of Economic Research, Inc.
    10. Silvia Balia, 2014. "Survival expectations, subjective health and smoking: evidence from SHARE," Empirical Economics, Springer, vol. 47(2), pages 753-780, September.

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