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Title: A Dynamic Model of Health, Education, and Wealth With Credit Constraints and Rational Addiction
Resulting in 1 citation.
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Hai, Rong |
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A Dynamic Model of Health, Education, and Wealth With Credit Constraints and Rational Addiction Presented: Chicago IL, American Economic Association Annual Meeting, January 2017 Cohort(s): NLSY97 Publisher: American Economic Association Keyword(s): Credit/Credit Constraint; Educational Attainment; Health/Health Status/SF-12 Scale; Life Cycle Research; Wealth Permission to reprint the abstract has not been received from the publisher. This paper develops and structurally estimates a life-cycle model where health, education, and wealth are endogenous accumulated processes depending on the history of an individual's optimal behaviors, on parental factors, and on cognitive and noncognitive abilities. The model investigates different pathways between education, health, and wealth by introducing endogenous human capital production, health production, and addictive preferences of unhealthy behavior in the presence of credit constraints. The effects of education on health include both the direct benefits of improving health production efficiency and the indirect benefits of reducing unhealthy behavior and raising earnings. Using data from National Longitudinal Survey of Youth 97, we estimate the model using a two-step estimation procedure based on factor analysis and simulated method of moments. Using estimated model, we quantify the relative importance of socioeconomic determinants of human capital inequality and health inequality. We also use to model to conduct counterfactual policy experiments. |
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Bibliography Citation
Hai, Rong. "A Dynamic Model of Health, Education, and Wealth With Credit Constraints and Rational Addiction." Presented: Chicago IL, American Economic Association Annual Meeting, January 2017. |