Non-monotonic health behaviours - implications for individual health-related behaviour in a demand-for-health framework

Kristian Bolin and Björn Lindgren
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Björn Lindgren: Centre for Health Economics, University of Gothenburg, Gotenburg, Sweden; Dept of Health Sciences, Lund University, Lund, Sweden; National Bureau of Economic Research, Cambridge MA, US

No 588, Working Papers in Economics from University of Gothenburg, Department of Economics

Abstract: A number of behaviours influence health in a non-monotonic way. Physical activity and alcohol consumption, for instance, may be beneficial to one’s health in moderate but detrimental in large quantities. We develop a demand-for-health framework that incorporates the feature of a physiologically optimal level. An individual may still choose a physiologically non-optimal level, because of the trade-off in his or her preferences for health versus other utility-affecting commodities. However, any deviation from the physiologically optimal level will be punished with respect to health. A set of steady-state comparative statics is derived regarding the effects on the demand for health and health-related behaviour, indicating that individuals will react differently to exogenous changes, depending on the amount of the health-related behaviour they demand. We also show (a) that a steady-state equilibrium is a saddle-point and (b) that the physiologically optimal level may be a steady-state equilibrium for the individual. Our analysis suggests that general public-health policies may, to some extent, be counterproductive due to the responses induced in parts of the population.

Keywords: human capital; Grossman model; non-monotonic health investments; health; steadystate and stable equilibria (search for similar items in EconPapers)
JEL-codes: I12 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2014-03-27
New Economics Papers: this item is included in nep-ger and nep-hea
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Journal Article: Non-monotonic health behaviours – implications for individual health-related behaviour in a demand-for-health framework (2016)
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