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Health, Income, and Risk Aversion: Assessing Some Welfare Costs of Alcoholism and Poor Health

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  • John Mullahy
  • Jody L. Sindelar

Abstract

The economic costs of adverse health outcomes have typically been evaluated in a context of risk neutrality, an approach that ignores the potential welfare importance of individuals' risk preferences. This paper presents a framework that unifies the research in health capital and earnings with that on risk preferences in the presence of stochastic outcomes. The model is implemented to obtain estimates of the economic damages due both to general health problems as well as to one specific health problem that is of considerable interest from society's perspective: alcoholism.

Suggested Citation

  • John Mullahy & Jody L. Sindelar, 1995. "Health, Income, and Risk Aversion: Assessing Some Welfare Costs of Alcoholism and Poor Health," Journal of Human Resources, University of Wisconsin Press, vol. 30(3), pages 439-459.
    • Handle: RePEc:uwp:jhriss:v:30:y:1995:i:3:p:439-459
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    Cited by:

    1. Sumati Srinivas, 2016. "Risk Preferences and Obesity: A Behavioral Economics Approach," International Journal of Business and Social Research, LAR Center Press, vol. 6(7), pages 42-50, July.
    2. Christiaensen, Luc J.M. & Boisvert, Richard N., 2000. "On Measuring Household Food Vulnerability: Case Evidence from Northern Mali," Working Papers 127676, Cornell University, Department of Applied Economics and Management.
    3. Andrén, Daniela & Palmer, Edward, 2001. "The Effect Of Sickness On Earnings," Working Papers in Economics 45, University of Gothenburg, Department of Economics.
    4. Mullahy, John, 2024. "Analyzing health outcomes measured as bounded counts," Journal of Health Economics, Elsevier, vol. 95(C).
    5. Kuchler, Fred & Golan, Elise H., 1999. "Assigning Values To Life: Comparing Methods For Valuing Health Risks," Agricultural Economic Reports 34037, United States Department of Agriculture, Economic Research Service.
    6. Christiaensen, Luc J.M. & Boisvert, Richard N., 2000. "Validating Operational Food Security Indicators Against A Dynamic Benchmark," 2000 Annual meeting, July 30-August 2, Tampa, FL 21781, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    7. repec:eee:labchp:v:3:y:1999:i:pc:p:3309-3416 is not listed on IDEAS
    8. Christiaensen, Luc J. & Boisvert, Richard N. & Hoddinott, John, 2000. "Validating operational food insecurity indicators against a dynamic benchmark : evidence from Mali," Policy Research Working Paper Series 2471, The World Bank.
    9. Tetsuji Yamada & Michael Kendix & Tadashi Yamada, 1996. "The impact of alcohol consumption and marijuana use on high school graduation," Health Economics, John Wiley & Sons, Ltd., vol. 5(1), pages 77-92, January.
    10. Lixin Cai, 2009. "Effects of Health on Wages of Australian Men," The Economic Record, The Economic Society of Australia, vol. 85(270), pages 290-306, September.
    11. Sumati Srinivas, 2016. "Risk Preferences and Obesity: A Behavioral Economics Approach," International Journal of Business and Social Research, MIR Center for Socio-Economic Research, vol. 6(7), pages 42-50, July.

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    JEL classification:

    • I1 - Health, Education, and Welfare - - Health

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