Health care in Jamaica : quality, outcomes, and labor supply
Lavy, Victor | Palumbo, Michael | Stern, Steven N.
This paper investigates the relationships among labor force participation, health outcomes, and the availability and quality of health care in a developing country. The authors develop an econometric model that addresses the demand for health care in a choice model and then link it to health status outcomes and labor force participation decisions. The econometric model has two parts. First, the authors estimate a discrete choice model to determine how ill people choose among the various providers of health care. Using the parameter estimates from this model, they calculate the expected value of the best available medical facility which is then used as a measure of the quality of health care available to each individual. In the second state, health is allowed to affect labor force participation in a simultaneous equations probit model where the potential endogeneity of reported health is controlled for with a set of instruments that includes the constructed health care quality measure. The authors report the reults of simulating the impact on health outcomes and labor force participation of policy changes such as improving access to and quality of health care as well as reducing the price of health services.
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