NBER Working Papers by Mark L. Egan

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Working Papers

July 2014Non-Adherence In Health Care: A Positive and Normative Analysis
with Tomas J. Philipson: w20330
Non-adherence in health care results when a patient does not initiate or continue care that has been recommended by a provider. Previous researchers have identified non-adherence as a major source of waste in US healthcare, totaling approximately 2.3% of GDP, and have proposed a plethora of interventions to improve adherence. However, little explicit analysis exists in health economics of the dynamic demand behavior that drives non-adherence. We argue that while providers may be more informed about the population-wide effects of treatments, patients are more informed about their individual treatment effect. We interpret a patient’s adherence decision as an optimal stopping problem where patients learn the value of a treatment through experience. Our positive analysis derives an “adherence ...
August 2013International Health Economics
with Tomas J. Philipson: w19280
Perhaps because health care is a local service sector, health economists have paid little attention to international linkages between domestic health care economies. However, the growth in domestic health care sectors is often attributed to medical innovations whose returns are earned worldwide. Because world returns drive innovation and innovation is central to spending growth, spending growth in a given country is thereby highly affected by health care economies and policies of other countries. This paper analyzes the unique positive and normative implications of these innovation-induced linkages across countries when governments centrally price health care. Providing world returns to medical innovation under such central pricing involves a public-goods problem; the taxation to fund rei...
May 2013Adjusting National Accounting for Health: Is the Business Cycle Countercyclical?
with Casey B. Mulligan, Tomas J. Philipson: w19058
Many national accounts of economic output and prosperity, such as gross domestic product (GDP) or net domestic product (NDP), offer an incomplete picture by ignoring, for example, the value of leisure, home production, and the value of health. Previous discussed shortcomings of such accounts have focused on how unobserved dimensions affect GDP levels but not their cyclicality, which affects the measurement of the business cycle. This paper proposes a new methodology to measure economic fluctuations that incorporates monetized changes in health of the population in the United States and globally during the past 50 years. In particular, we incorporate in GDP the dollar value of mortality, treating it as depreciation in human capital analogous to how net domestic product (NDP) treats deprecia...

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