Over the past 50 years Germans have spent a rising share of their income on health and enjoyed substantially longer lives as a result. The rising health share can be explained by a standard economic model: As people get richer they purchase additional years of life and less additional...

We explore the hierarchy of two instruments, waiting time and coinsurance for medical treatment, for optimally solving the tradeoff between the economic gains from risk sharing and the losses from moral hazard. We show that the optimal waiting time is zero, given that the coinsurance rate is...

Salas and Raftery allege that in our paper, (1) remaining life expectancy is an endogenous explanatory variable of health care expenditure and (2) the parameter designed to correct for sample selection bias in fact represents a hidden relationship between health care expenditure and age. We...

The observation that average health care expenditure rises with age generally leads experts and laymen alike to conclude that population ageing is the main driver of health care costs. In recently published studies we challenged this view (Zweifel et al., 1999; Felder et al., 2000). Analysing health...

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The observation that average health care expenditure rises with age generally leads experts and laymen alike to conclude that population ageing is the main driver of health care costs. In recently published studies we challenged this view (Zweifel et al., 1999; Felder et al., 2000). Analysing health...

In the expected-utility theory of the monetary value of a statistical life, a well-known result found by Pratt and Zeckhauser [1996] asserts that an individuals' willingness to pay (WTP) for a marginal reduction in mortality risk increases with the initial level of risk. Their reasoning is based...