Living Rationally Under the Volcano? An Empirical Analysis of Heavy Drinking and Smoking

Peter Arcidiacono, Holger Sieg and Frank Sloan

No 8602, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This study investigates whether models of forward-looking behavior explain the observed patterns of heavy drinking and smoking of men in late middle age in the Health and Retirement Study better than myopic models. We develop and estimate a sequence of nested models which differ by their degree of forward-looking behavior. We also study models which allow for heterogeneity in discounting, and thus test whether certain types of individuals are more likely to show forward-looking behavior than other types. Our empirical findings suggest that forward-looking models with an annual discount factor of approximately 0.78 fit the data the best. These models also dominate other behavioral models based on out-of-sample predictions using data of men aged 70 and over. Myopic models predict rates of smoking and drinking for old individuals which are significantly larger than those found in the data on elderly men.

JEL-codes: C1 I1 (search for similar items in EconPapers)
Date: 2001-11
New Economics Papers: this item is included in nep-mic
Note: EH
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published as Peter Arcidiacono & Holger Sieg & Frank Sloan, 2007. "Living Rationally Under The Volcano? An Empirical Analysis Of Heavy Drinking And Smoking," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 48(1), pages 37-65, 02.

Downloads: (external link)
http://www.nber.org/papers/w8602.pdf (application/pdf)

Related works:
Journal Article: LIVING RATIONALLY UNDER THE VOLCANO? AN EMPIRICAL ANALYSIS OF HEAVY DRINKING AND SMOKING (2007)
Working Paper: Living Rationally Under the Volcano? An Empirical Analysis of Heavy Drinking and Smoking (2002)
Working Paper: Living Rationally Under the Volcano? An Empirical Analysis of Heavy Drinking and Smoking
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:8602

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w8602

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().