For Better or Worse? Subjective Expectations and Cost-Benefit Trade-Offs in Health Behavior

Gabriella Conti and Pamela Giustinelli

No 16143, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We provide a framework to disentangle preferences and beliefs in health behavior and apply it to lockdown compliance in the UK. We estimate a model of compliance choice with uncertain costs and benefits to quantify utility tradeoffs, decompose group differences in compliance, and compute monetary compensations for complying. Individuals have largest disutility from passing away from COVID and being caught transgressing, and largest utility from preserving their mental health. While preferences and beliefs explain compliance differences by gender, only preferences drive differences by vulnerability. When others fail to comply and trust breaks down, the risk tolerant and those without prior COVID experience comply less, the vulnerables more. When a public figure breaches the rules, opponents comply less. Heterogenous beliefs, preferences, and responses to others are key to health policies.

Keywords: health behaviors; beliefs; preferences; COVID-19 (search for similar items in EconPapers)
JEL-codes: C25 C83 D84 I12 I18 (search for similar items in EconPapers)
Pages: 81 pages
Date: 2023-05
New Economics Papers: this item is included in nep-upt
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Related works:
Working Paper: For Better or Worse? Subjective Expectations and Cost-Benefit Trade-Offs in Health Behavior (2023)
Working Paper: For better or worse? Subjective expectations and cost-benefit trade-offs in health behavior (2023)
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