On Adaptation, Life-Extension Possibilities and the Demand for Health

University of Oslo Health Econ. Rsrch. Prog. Working Paper No. 2001:7

37 Pages Posted: 28 Feb 2002

See all articles by Jon Gjerde

Jon Gjerde

Norwegian Computing Center

Sverre Grepperud

University of Oslo - Center for Health Administration

Snorre Kverndokk

Ragnar Frisch Centre for Economic Research

Abstract

The purpose of this paper is to analyse the impacts of adaptation to a falling health state on the demand for health and medical care. This is done by integrating adaptation processes in the pure consumption model of Grossman. We also modify the model in another direction by introducing an uncertain lifetime. Model simulations show that adaptation affects the health variables by lowering the incentives to invest in health, as well as smoothening the optimal health stock path over the life cycle. Whether or not the risk of mortality is an object of choice has important effects on the joint development of the health variables.

Keywords: Grossman model; Demand for health; Adaptation; Life extension; Ageing

JEL Classification: C61, D91, I12

Suggested Citation

Gjerde, Jon and Grepperud, Sverre and Kverndokk, Snorre, On Adaptation, Life-Extension Possibilities and the Demand for Health. University of Oslo Health Econ. Rsrch. Prog. Working Paper No. 2001:7. Available at SSRN: https://ssrn.com/abstract=302415 or http://dx.doi.org/10.2139/ssrn.302415

Jon Gjerde

Norwegian Computing Center ( email )

P. O. Box 114 Blindern
0314 Oslo
Norway
+ 47 22 85 26 85 (Phone)
+ 47 22 69 76 60 (Fax)

Sverre Grepperud

University of Oslo - Center for Health Administration ( email )

The National Hospital
0027 Oslo
Norway
+ 47 23 07 53 11 (Phone)
+ 47 23 07 53 10 (Fax)

Snorre Kverndokk (Contact Author)

Ragnar Frisch Centre for Economic Research ( email )

Gaustadalleen 21
N-0349 Oslo
Norway
+47 22958811 (Phone)
+47 22958825 (Fax)

HOME PAGE: http://www.frisch.uio.no/cv/snorrek_eng.html

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