Journal article

The link between health and economic preferences: Evidence from 22 OECD countries

Xi Cen, David W Johnston, Claryn SJ Kung, Michael A Shields, Eric C Sun

HEALTH ECONOMICS | WILEY | Published : 2021

Abstract

We study the link between health status and economic preferences using survey data from 22 Organisation for Economic Co-operation and Development (OECD) countries. We hypothesize that there is a relationship between poor health and the preferences that people hold, and therefore their choices and decisions. We find that individuals with a limiting health condition are more risk averse and less patient, and that this is true for physical and mental health conditions. The magnitudes of the health gap are approximately 60% and 70% of the gender gap in risk and time preferences, respectively. Importantly, the health gaps are large for males, females, young, old, school dropouts, degree holders, ..

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