Academic journal article Contemporary Economic Policy

Transferring Measures of Adult Health Benefits to Children: A Review of Issues and Results

Academic journal article Contemporary Economic Policy

Transferring Measures of Adult Health Benefits to Children: A Review of Issues and Results

Article excerpt


Protection of one's health is expensive. The reasons are simple. Opportunities for a person to borrow to invest in his or her health are limited because human capital, a component of which is health, makes poor collateral. Also, free and functioning public health facilities to which a person has access do not exist or are free in name only. The individual must therefore draw on his or her own resources or on those of his or her kin to support the person's health.

This article discusses issues involved in inferring the economic value of children's health from estimates of the value of adult health. Such inferences are an important dimension of the general economic benefits transfer problem in which policy makers, when confronted with yet another policy problem, must decide whether to extrapolate to a new setting the results of benefits studies performed in other contexts or to commission a new benefits assessment unique to the current setting. But the transfer of adult health benefit measures to children has a feature making it analytically and empirically quite different from benefits transfers involving, say, outdoor recreation or residential properties. (1) In particular, because market and public institutions usually do not fulfill the individual's demand for own health, he or she seeks help from another social institution--family (the authors use family and household, and adult and parent, interchangeably throughout this essay).

Most adults and nearly all children live in family groups. But children have little if any economic standing in the society or in the family, though they have legal standing. They lack economic standing because modern industrialized societies believe children's cognitive, emotional, and physical capacities are too incomplete for them to be independent decision makers with attendant rights and responsibilities. Children are viewed as becomings rather than beings; they are no more the little adults of medieval times (Aries, 1962). Family adults thus decide how much to invest in their children's physical, intellectual, and emotional health. Whether genetics or the immediate cultural environment ultimately drives this investment, its proximate source is a family adult's decision, and, for these adults, it must contest with the demands that own consumption and investments in own health make upon scarce family resources. (2) Scarce family resources cause the health of adult and child members to be economically linked.

Numerous studies have appeared in the past 15 years that summarize, with an eye to benefits transfer, the economic valuation literature on various facets of the natural environment or human health. (3) These summaries are statistical syntheses rather than qualitative literary overviews. They presume that an unspecified grand analytical valuation model for the facet exists that has generated different random samples, each of which has been used in a distinct study. Each study is said to represent an imperfect replication of the undefined common analytical structure. One or another of a variety of statistical estimators is then used to explain the study procedure sources (sample characteristics, measurement technique, baseline conditions, functional form, etc.) of these imperfections or to build a grand valuation model based on the statistical similarities among studies.

This article suggests that if transfers of health benefit estimates across individuals are to be useful to policy makers, they must be founded on analytical as well as statistical commonalities. Synthesis requires more than the application of statistical minutiae. A common vision across studies of what health is and of the economic structure underlying investment behaviors that influence health must also prevail. Otherwise, statistical expositions of similarities among health benefits studies become little more than intellectually dexterous correlations rather than systematic explorations of the causes and effects of study differences. …

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