@mastersthesis {6351, title = {Essays on Health Economics}, volume = {3714612}, year = {2015}, note = {Copyright - Copyright ProQuest, UMI Dissertations Publishing 2015 Last updated - 2015-08-26 First page - n/a}, month = {2015}, pages = {95}, school = {The University of Wisconsin - Madison}, type = {Ph.D.}, address = {Madison, WI}, abstract = {The first chapter, co-authored with Michael Batty, investigates how financial constraints influence hospital care. Specifically we study the impacts of recently enacted state "Fair Pricing" laws, which explicitly limit how much hospitals can collect from uninsured patients. Using the Nationwide Inpatient Sample, we find that the introduction of a fair pricing law leads to reductions in the amount of care delivered to uninsured patients, but find no evidence of deterioration of short-term quality of care. Overall, our results provide strong evidence that hospitals actively alter their behavior in response to financial incentives, and are consistent with the laws promoting a shift towards more efficient care delivery. In the second chapter I investigate how retirement incentives embedded in health insurance contracts influence labor market decisions of older workers. Employers typically offer one of two types of health plans: tied contracts (coverage ends at retirement) or retiree contracts (coverage continues in retirement). In comparison to a retiree plan, a tied contract provides an obvious incentive to delay retirement, but which workers stay? Particularly, what are the health characteristics of workers who respond to the incentives of the tied contract? I show that, contrary to suggestions in the literature, tied contracts produce advantageous selection. Additionally, I investigate the fact that tied contracts are consistently found to delay retirement even after age 65 - at which point workers are eligible for Medicare coverage. I show that this "excess retention" effect is entirely driven by workers with younger spouses who do not have their own insurance. The final chapter is joint work with Michael Batty and Joseph Levy, and examines how physician behavior responds to the introduction of a "panel-based" compensation structure - where a large portion of compensation is based on the number of patients a provider is responsible for, rather than the amount of work actually done. Taking advantage of a natural experiment at a large academic health system, we show that physician behavior is surprisingly unresponsive to changes in incentives - particularly for those who experienced a clear reduction in production incentives.}, keywords = {Employment and Labor Force, Healthcare, Income, Insurance, Methodology, Net Worth and Assets, Retirement Planning and Satisfaction}, url = {http://proxy.lib.umich.edu/login?url=http://search.proquest.com/docview/1700219263?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004\&ctx_enc=info:ofi/enc:UTF-8\&rfr_id=info:sid/Dissertations+\%26+Theses+\%40+CIC+Institutions\&rft_val_fmt=info:of}, author = {Ippolito, Benedic N.} } @mastersthesis {6214, title = {Essays on Health Economics and Consumer Finance}, volume = {3708721}, year = {2015}, note = {Copyright - Copyright ProQuest, UMI Dissertations Publishing 2015 Last updated - 2015-08-26 First page - n/a}, month = {2015}, pages = {106}, school = {The University of Wisconsin - Madison}, type = {Ph.D.}, address = {Madison, WI}, abstract = {Chapter 1: Recently enacted state laws that limit how much hospitals can charge uninsured patients provide a unique opportunity to study how financial incentives of healthcare providers affect the care they deliver. Using an event study framework, we find that these fair pricing laws lead to a seven to nine percent reduction in the average length of hospital stay for uninsured patients. Although the longer-term effects of these care reductions are uncertain, they are not accompanied by worsening of short-term measures of quality of care. Overall, our results provide strong evidence that hospitals actively alter their behavior in response to financial incentives, and are consistent with the laws promoting a shift towards more efficient care delivery. Chapter 2: The list price for an average unit of care is more than three times what a hospital will be paid for treating a typical patient, and different hospitals charge widely different prices for the same service. These facts may seem innocuous, but many uninsured and out-of-network patients do pay list price. This paper uncovers patterns in hospital list prices, and explores several potential explanations. We find that markups vary much more across hospitals than within, but geography and quality of care explain little of the overall variation. Further, large, urban, well-equipped, for-profit hospitals have the highest list prices. A quirk in the Medicare Outlier Payment formula appears to have contributed to rapid price increases prior to 2004. Overall, our findings are consistent with more financially-sophisticated and profit-motivated hospitals more aggressively pursuing revenue from uninsured and out-of-network patients. Chapter 3: Many researchers and policy makers worry that Americans are not saving adequately for retirement. However, it is difficult to agree upon what constitutes adequate savings. This paper compares wealth accumulation patterns of different cohorts of Americans born in the first half of the 20th century. This comparative standard frames the retirement prospects of future and recent retirees in terms of the documented retirement experiences of older generations. Contrary to common perception, I find that the wealth accumulation of Americans nearing and entering retirement today is very similar to that of older generations.}, keywords = {Consumption and Savings, Healthcare, Methodology, Retirement Planning and Satisfaction}, url = {http://proxy.lib.umich.edu/login?url=http://search.proquest.com/docview/1697328358?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004\&ctx_enc=info:ofi/enc:UTF-8\&rfr_id=info:sid/Dissertations+\%26+Theses+\%40+CIC+Institutions\&rft_val_fmt=info:of}, author = {Batty, Michael M.} } @mastersthesis {6408, title = {Essays on gender differences in occupational choices and cohort analysis of saving adequacy}, volume = {3590468}, year = {2013}, note = {Copyright - Copyright ProQuest, UMI Dissertations Publishing 2013 Last updated - 2013-09-24 First page - n/a}, month = {Jul 2013}, pages = {103}, school = {The University of Wisconsin - Madison}, type = {Ph.D.}, abstract = {The first chapter analyzes how human capital depreciation affects occupational gender segregation. Prior studies are biased because, given an occupational depreciation rate, female workers endogenously choose the duration of leave. I address this problem by proposing an alternative depreciation measure utilizing involuntary job displacement shocks. Using this depreciation proxy along with additional pecuniary and non-pecuniary occupational attributes, I estimate a conditional logit model of occupational choices separately for male and female college graduates using NLSY79 data. The results show that men and women differ largely in selection on many occupational attributes, however, the gender difference in depreciation is statistically insignificant after accounting for additional variance from the generated depreciation regressor. The second chapter explores the trend of gender differences in selection on occupational mobility. Women who interrupt their career and return to the labor force face the uncertainty of forming a new job match. This uncertainty can be large if the skills they acquired are occupational-specific. I estimate discrete occupational choices by different cohorts using cross-sectional Current Population Survey (CPS) from 1979 to 2008.I find that over the past 30 years, the consideration of occupational mobility has abated in female occupational decisions. In addition, gender gaps in work hours and visual perception also narrow over the past thirty years. Increasing female representation is evident in occupations with high entry barriers, long work hours, and visual intensive tasks. In the third chapter, we extend the dynamic programming approach used in Scholz, Seshadri, and Khitatrakun (2006) to assess the adequacy of retirement wealth preparation in 2008, using a sample of Americans born before 1954. We examine whether these households have accumulated the wealth necessary to maintain pre-retirement living standards in retirement. Our preliminary results suggest that over 70 percent of the households in our sample had accumulated sufficient resources in 2008. The results suggest a less optimistic view about the adequacy of Americans{\textquoteright} retirement preparation than the findings for 1992 in Scholz, Seshadri, and Khitatrakun (2006). Economically disadvantaged households are significantly more likely than others to be under-saving and hence are natural targets for outreach and other efforts to improve financial capabilities.}, keywords = {Consumption and Savings, Demographics, Employment and Labor Force, Methodology, Net Worth and Assets}, url = {http://search.proquest.com.proxy.lib.umich.edu/docview/1432177424?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004\&ctx_enc=info:ofi/enc:UTF-8\&rfr_id=info:sid/Dissertations+\%26+Theses+\%40+CIC+Institutions\&rft_val_fmt=info:ofi/fmt:kev:mtx:dis}, author = {Li, Hsueh-Hsiang} } @mastersthesis {6216, title = {Essays on health economics}, volume = {3606130}, year = {2013}, note = {Copyright - Copyright ProQuest, UMI Dissertations Publishing 2013 Last updated - 2014-02-22 First page - n/a}, month = {2013}, pages = {118}, school = {The University of Wisconsin - Madison}, type = {Ph.D.}, address = {Madison, WI}, abstract = {Chapter 1: Medicare provides nearly-universal health insurance for individuals aged 65 and older. The discontinuity in eligibility for Medicare provides an instrument for assessing the effects of insurance coverage on health outcomes. Using regression discontinuity analysis and data from the BRFSS, this paper finds an increase in utilization of preventive health services, as well as an improvement in self-reported health, at age 65. The effects vary across education level and gender. However, these results would be biased by high retirement rates at age 65. To address this issue, I run similar analysis at age 62, when individuals are first eligible to collect Social Security. I find that utilization is positively correlated with insurance but not retirement. The implications of these findings for assessing the cost-effectiveness of preventive care are limited, because the cross-sectional data do not capture the long-term benefits of diagnostic procedures. Chapter 2: This paper assesses the effects of working on the health of less-educated women, particularly mothers. These effects are difficult to estimate because health status affects labor force participation. To address this endogeneity problem, I use an instrumental variables estimation approach. Throughout the 1990s, changes in the EITC and the transition from AFDC to TANF provided exogenous incentives for women to enter the work force, independent of their own health status. This paper builds on the literature by including the incentives created by welfare reform and EITC which vary by state. It also includes measures of both physical and mental self-reported health, giving a broad picture of the effects of entering the labor force on the health of this population. Chapter 3: This chapter (with Atsuko Tanaka), examines the effect of depression on various labor force outcomes, including hours worked and wages. We use panel data from the Japanese Panel Survey of Consumers (JPSC) and the Health and Retirement Study (HRS) to follow respondents over several years, using questions about both mental health and labor force outcomes. In order to understand the causal effect of depression on work participation and compensation, we use deaths of the parents of respondents as an exogenous shock to mental health.}, keywords = {Employment and Labor Force, Health Conditions and Status, Insurance, Methodology, Other, Retirement Planning and Satisfaction, Women and Minorities}, url = {http://search.proquest.com.proxy.lib.umich.edu/docview/1492136506?accountid=14667http://mgetit.lib.umich.edu/?ctx_ver=Z39.88-2004\&ctx_enc=info:ofi/enc:UTF-8\&rfr_id=info:sid/Dissertations+\%26+Theses+\%40+CIC+Institutions\&rft_val_fmt=info:ofi/fmt:kev:mtx:dis}, author = {Beck, Laurel} } @mastersthesis {6198, title = {Three essays in public economics}, volume = {3592578}, year = {2013}, month = {2013}, pages = {124}, school = {The University of Wisconsin - Madison}, type = {Ph.D.}, address = {Madison, WI}, abstract = {The first and second chapters of this dissertation consider household financial decision making. In the first chapter I examine the phenomenon of early claiming for Social Security retirement benefits. Previous work has shown that early claiming, in particular by the primary earner in married couples, is not consistent with household benefit maximization nor is it predicted by models of utility maximization. I show that observed claiming behavior is explained well by a model in which the primary earner chooses when to claim without taking into consideration the effect of the choice on the secondary earner{\textquoteright}s spousal and survivor benefits. I find that the decrease in the value of household benefits due to early claiming is borne almost entirely by the surviving spouse. In the second chapter, with John Karl Scholz and Ananth Seshadri, we use the insight of a lifecycle model to better understand the factors that affect household retirement savings targets. Two of the most important determinants of savings targets are households{\textquoteright} location in the lifetime income distribution and number of children. We measure the deviation of a set of financial guidelines for retirement saving from the optimal asset accumulation implied by the lifecycle model and suggest an alternate savings heuristic that takes into account insights from the lifecycle model. The third chapter applies a novel estimation strategy to measure the benefit of hazardous waste site remediation. In contrast to previous estimates, this method calculates the benefit of site remediation allowing for diminishing marginal utility. Using data on home sales in Cincinnati, Ohio in 2000 I find the median willingness to pay for a one mile increase to the nearest hazardous waste site is $228 per year. This is lower than previous estimates which range from $284 to $1,065 per year.}, keywords = {Health Conditions and Status, Methodology, Net Worth and Assets, Other, Public Policy, Social Security}, author = {Anderson, Michael Throan} } @article {5945, title = {The Interplay of Wealth, Retirement Decisions, Policy and Economic Shocks}, year = {2012}, institution = {Ann Arbor, The University of Michigan}, abstract = {We develop a model of health investments and consumption over the life cycle where health affects longevity, provides flow utility, and retirement is endogenous. We develop a rich, numerical life-cycle model to study the complex interrelationship between health and wealth and the age of retirement. The decision to retire depends on a number of factors including earnings and health shocks, demographic characteristics, preferences, pensions, and social security. We incorporate these features in a computational model of optimal wealth and retirement decisions, solving the model household-by-household using data from the HRS. We use the model to study how workers would respond to an increase in the early eligibility age of retirement (EEA), and to what extent will the bad economy alter retirement plans. We find that increasing the EEA results in sizeable responses to the age of retirement but does not affect health outcomes very much. A 20 percent reduction in wealth induces households to delay retirement by one year, on average, with poor households being relatively unaffected.}, keywords = {Consumption and Savings, Demographics, Event History/Life Cycle, Health Conditions and Status, Healthcare, Net Worth and Assets, Retirement Planning and Satisfaction, Social Security}, url = {http://www.mrrc.isr.umich.edu/publications/publications_download.cfm?pid=860}, author = {John Karl Scholz and Ananth Seshadri} } @article {7697, title = {A New Test of Borrowing Constraints for Education}, journal = {The Review of Economic Studies}, volume = {79}, year = {2012}, pages = {511{\textendash}538}, publisher = {79}, abstract = {We discuss a simple model in which parents and children make investments in the children{\textquoteright}s education and investments for other purposes and parents can transfer cash to their children. We show that for an identifiable set of parent-child pairs, parents will rationally underinvest in their child{\textquoteright}s education. For these parent-child pairs, additional financial aid will increase educational attainment. The model highlights an important feature of higher education finance, the expected family contribution (EFC) that is based on income, assets, and other factors. The EFC is neither legally guaranteed nor universally offered: our model identifies the set of families that are disproportionately likely to not provide their full EFC. Using a common proxy for financial aid, we show, in data from the Health and Retirement Study, that financial aid increases the educational attainment of children whose families are more likely than others to underinvest in education. Financial aid has no effect on the educational attainment of children in other families. The theory and empirical evidence identifies a set of children who face quantitatively important borrowing constraints for higher education. PUBLICATION ABSTRACT}, keywords = {Adult children, Demographics, Education, Methodology}, doi = {10.1093/restud/rdr032}, author = {Brown, Meta and John Karl Scholz and Ananth Seshadri} } @article {5915, title = {The Influence of Public Policy on Health, Wealth and Mortality}, number = {UM11-12}, year = {2011}, institution = {The University of Michigan}, address = {Ann Arbor, MI}, abstract = {In this project we extend an augmented lifecycle model, incorporating a Grossman-style model of health capital, to enhance understanding of factors influencing consumption, wealth and health. We develop three primary results when using the model to explore the effects of stylized versions of Medicare and Social Security on wealth and longevity. First, our model calibration implies consumption and health are complements. As health depreciates with age, households will get less utility from consumption than would be in the case of a lifecycle model that does not endogenize health. Second, it appears that forward-looking households, when confronted by a substantially reduced safety net, will respond by reducing consumption and by reducing their health investment and therefore longevity. Third, there is a potentially important difference between short- and long- run responses to policy.}, keywords = {Consumption and Savings, Event History/Life Cycle, Health Conditions and Status, Net Worth and Assets, Public Policy}, url = {https://mrdrc.isr.umich.edu/projects/the-influence-of-public-policy-on-health-wealth-and-mortality/}, author = {John Karl Scholz and Ananth Seshadri} } @article {5807, title = {Health and Wealth in a Life-Cycle Model}, year = {2010}, institution = {The University of Michigan, Michigan Retirement Research Center}, abstract = {This paper presents a preliminary model of health investments over the life cycle. Health affects both longevity and provides flow utility. We analyze the interplay between consumption choices and investments in health by solving each household s dynamic optimization problem to obtain predictions on health investments and consumption choices over the lifecycle. Our preliminary model does a good job of matching the distribution of medical expenses across households in the sample. We illustrate the scope of future model applications by examining the effects of a stylized Medicare program on patterns of wealth and mortality.}, keywords = {Consumption and Savings, Event History/Life Cycle, Health Conditions and Status, Healthcare, Medicare/Medicaid/Health Insurance, Net Worth and Assets}, url = {https://mrdrc.isr.umich.edu/pubs/health-and-wealth-in-a-life-cycle-model/}, author = {John Karl Scholz and Ananth Seshadri} } @article {5768, title = {Are all Americans saving {\textquoteright}optimally{\textquoteright} for retirement?}, number = {No. 2008-189}, year = {2009}, institution = {Michigan Retirement Research Center, University of Michigan}, address = {Ann Arbor, MI}, abstract = {Many people fear that Americans are preparing poorly for retirement. But developing rigorous evidence on this issue is difficult. In this paper we briefly discuss evidence on the adequacy of retirement wealth accumulation. We conclude that existing descriptive evidence does not seem consistent with dire assessments of poor financial preparation. We then extend the straightforward, but computationally complex dynamic programming approach used in our earlier work to assess the adequacy of retirement wealth preparation of Americans born before 1954. We find only 4 percent of HRS households have net worth below their optimal targets in 2004, though this percentage is somewhat higher for more recent HRS cohorts. While our work is preliminary, we find little evidence that Americans born before 1954 have prepared poorly for retirement.}, keywords = {Consumption and Savings, Restricted data, Retirement Planning and Satisfaction}, doi = {10.2139/ssrn.1337653}, author = {William G. Gale and John Karl Scholz and Ananth Seshadri} } @article {5763, title = {A New Test of Borrowing Constraints for Education}, number = {14879}, year = {2009}, institution = {National Bureau of Economic Research}, address = {Cambridge, MA}, abstract = {We discuss a simple model of intergenerational transfers with one-sided altruism: parents care about their child but the child does not reciprocate. Parents and children make investments in the child s education, investments for other purposes, and parents can transfer cash to their child. We show that for an identifiable set of parent-child pairs, parents will rationally under-invest in their child s education. For these parent-child pairs, additional financial aid will increase educational attainment. The model highlights an important feature of higher education finance, the expected family contribution (EFC) that is based on income, assets, and other factors. The EFC is neither legally guaranteed nor universally offered: Our model identifies the set of families that are disproportionately likely to not provide their full EFC. Using a common proxy for financial aid, we show, using of data from the Health and Retirement Study, that financial aid increases the educational attainment of children whose families are disproportionately likely to under-invest in education. Financial aid has no effect on the educational attainment of children in other families. The theory and empirical evidence identifies a set of children who face quantitatively important borrowing constraints for higher education.}, keywords = {Adult children}, doi = {10.3386/w14879}, author = {Brown, Meta and John Karl Scholz and Ananth Seshadri} } @article {5687, title = {Children and Household Wealth}, number = {2007-158}, year = {2007}, institution = {Michigan Retirement Research Center, University of Michigan}, address = {Ann Arbor, MI}, abstract = {This paper examines the effects of children on consumption and wealth. To anchor intuition, we develop implications using a simple permanent income model with no uncertainty and complete markets. But this framework does not come close to matching the distribution of existing wealth. We therefore examine the effects of children using a rich, augmented life-cycle model, and using a life-cycle model with endogenous fertility. We find that children have a large effect on household s net worth and consequently are an important factor in understanding the wealth distribution. The effects of children are much larger than the effects of asset tests associated with cash and near-cash transfers, given earnings realizations and the social security system experienced by households in the original HRS cohort. We also show that fertility and credit constraints interact in ways that significantly affect wealth accumulation.}, keywords = {Adult children, Net Worth and Assets}, doi = {http://dx.doi.org/10.2139/ssrn.1083829}, author = {John Karl Scholz and Ananth Seshadri} } @article {10909, title = {Are Americans saving "optimally" for retirement?}, journal = {Journal of Political Economy}, volume = {114}, year = {2006}, abstract = {We solve each household{\textquoteright}s optimal saving decisions using a life cycle model that incorporates uncertain lifetimes, uninsurable earnings and medical expenses, progressive taxation, government transfers, and pension and social security benefits. With optimal decision rules, we compare, household by household, wealth predictions from the life cycle model using a nationally representative sample. We find, making use of household-specific earnings histories, that the model accounts for more than 80 percent of the 1992 cross-sectional variation in wealth. Fewer than 20 percent of households have less wealth than their optimal targets, and the wealth deficit of those who are undersaving is generally small.}, keywords = {life cycle model, optimal saving, Social Security}, doi = {10.1086/506335}, author = {John Karl Scholz and Ananth Seshadri and Khitatrakun, Surachai} } @article {5674, title = {Tied Transfers}, year = {2006}, institution = {University of Wisconsin-Madison, Dept. of Economics}, keywords = {Adult children, Consumption and Savings, Demographics}, url = {https://www.ssc.wisc.edu/~scholz/Research/Tied_Transfers.pdf}, author = {Brown, Meta and Mazzocco, Maurizio and John Karl Scholz and Ananth Seshadri} } @article {10908, title = {Are Americans saving "optimally" for retirement?}, number = {10260}, year = {2004}, institution = {The National Bureau of Economic Research}, address = {Cambridge, MA}, abstract = {This paper examines the degree to which Americans are saving optimally for retirement. Our standard for assessing optimality comes from a life-cycle model that incorporates uncertain lifetimes, uninsurable earnings and medical expenses, progressive taxation, government transfers, and pension and social security benefit functions derived from rich household data. We solve every household{\textquoteright}{\textquoteright}s decision problem from death to starting age and then use the decision rules in conjunction with earnings histories to make predictions about wealth in 1992. Ours is the first study to compare, household by household, wealth predictions that arise from a life-cycle model that incorporates earnings histories for a nationally representative sample. The results, based on data from the Health and Retirement Study, are striking we find that the model is capable of accounting for more than 80 percent of the 1992 cross-sectional variation in wealth. Fewer than 20 percent of households have less wealth than their optimal targets, and the wealth deficit of those who are undersaving is generally small.}, keywords = {life-cycle model, Retirement, Saving}, doi = {10.3386/w10260}, author = {John Karl Scholz and Ananth Seshadri and Khitatrakun, Surachai} } @article {5471, title = {Achieving Retirement Security or a Loophole Ridden Tax Code? Saving Incentives in the U.S.}, year = {2001}, institution = {University of Wisconsin-Madison, Dept. of Economics}, keywords = {Consumption and Savings, Public Policy}, url = {http://cerp.unito.it/english/Agenda/Paper_2001/scholtz.PDF}, author = {John Karl Scholz} } @article {5447, title = {Can Americans Maintain Pre-Retirement Consumption Standards in Retirement?}, year = {2001}, institution = {University of Wisconsin-Madison}, keywords = {Consumption and Savings, Income, Retirement Planning and Satisfaction}, author = {John Karl Scholz} } @article {5419, title = {Pensions and Wealth: New Evidence from the Health and Retirement Study}, year = {2000}, institution = {Dept. of Economics, University of Wisconsin-Madison}, keywords = {Net Worth and Assets, Pensions}, author = {Khitatrakun, Surachai and Kitamura, Yuichi and John Karl Scholz} }