Efficiency of Health Investment: Education or Intelligence?

Govert Bijwaard and Hans van Kippersluis
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Hans van Kippersluis: Erasmus University Rotterdam, the Netherlands

No 15-004/V, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: In this paper we hypothesize that education is associated with a higher efficiency of health investment, yet that this efficiency advantage is solely driven by intelligence. We operationalize efficiency of health investment as the probability of dying conditional on a certain hospital diagnosis, and estimate a multistate structural equation model with three states: (i) healthy, (ii) ill (in hospital), and (iii) death. We use data from a Dutch cohort born around 1940 that links intelligence tests at age 12 to later-life hospitalization and mortality records. The results suggest that higher Intelligence induces the higher educated to be more efficient users of health investment - intelligent individuals have a clear survival advantage for most hospital diagnoses - yet for unanticipated health shocks and diseases that require complex treatments such as COPD, education still plays a role.

Keywords: Education; Intelligence; Health; Multistate duration model (search for similar items in EconPapers)
JEL-codes: C41 I14 I24 (search for similar items in EconPapers)
Date: 2014-01-09
New Economics Papers: this item is included in nep-edu and nep-hea
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Related works:
Journal Article: Efficiency of Health Investment: Education or Intelligence? (2016)
Working Paper: Efficiency of health investment: education or intelligence? (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:20150004

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