SUMMARY In this paper, we estimate a copula‐based bivariate dynamic hurdle model of prescription drug and nondrug expenditures to test the cost‐offset hypothesis, which posits that increased expenditures on prescription drugs are offset by reductions in other nondrug expenditures. We apply...

This paper makes three contributions. First, it uses copula functions to obtain a flexible bivariate parametric model for nonnegative integer-valued data (counts). Second, it recovers the distribution of the difference in the two counts from a specifed bivariate count distribution. Third, the...

This article considers modeling response bias when the response is a count. The authors adopt a “structural approach†by using a generalized negative binomial mixture of Poisson distribution to model misreported counts, assuming that the distribution of the true response follows a...

A great deal of recent work in econometrics has focused on the development of tests to detect violations of the assumptions of ordinary least squares regression. These tests are referred to collectively as specification tests. This article evaluates some important and computationally convenient...

With the expansion of Medicare, increasing attention has been paid to the behavior of elderly persons in choosing health insurance. This article investigates how the elderly use plan attributes to screen their Medicare health plans to simplify a complicated choice situation. The proposed model...