Schuppan Kyle Health Economics Written Portion of Midterm 3/11/11 1.) a.) The two main elements of the Grossman Model are Time budget constraints and Goods budget constraints. Time budget constraints are things like time spent on health (gym, diet), time on consumption of health products, time spent on work, and time spent sick. Goods budget constraints are characterized as price of goods, amount of medical care, and overall other goods. b.) The two variables for the Grossman model that social capital might operate through are consumption goods and investment goods. Social capital can operate through consumption goods and increase health stock by making networks and friends that can help you stay healthy. A good example of this is weight loss programs that offer classes and clinics. Social capital can also operate through investment goods by allowing workers to stay healthy and provide more for a company and thus society. c.) If one were to add social capital to the model, you get more utility from health. Therefore you have more incentive to invest in health.
2.) a.) The dependent variable is the score of the EQ-5D test, which is an overall score of a persons health. The second dependent variable would be the overall outcome of health of the people. The independent variables would be the three questions asked. as Such Are you able to trust other? , Do you have a good connection and re lationship with family and friends? , Do you participate civica lly in politics and government?
My hypothesis for the above question would be, the more people had trust with others, had a supportive family and friends network, and were more active ly involved civica lly, the higher the ir EQ-5D score, or health, would be. b.) By looking at the model it concludes that the higher the social capital the higher someones overall health would be. What surprised me the most was if a person does not have a strong supportive network around them, how much their health drops. c.) They say with association because with most things in life you can never have a clear cut, cause and effect. Also this is just one study, so to say that all these independent variables truly cause these dependent variables to act the way they do, would be a stretch. d.) There was one main similarity between the articles. It was how the physician cannot appear at least to be maximizing his profits all the time; instead he needs to be looking out for the persons best interest. Well it is the same thing in social capital; the more the person has a strong friendly relationship and not so much a business only relationship the better the quality of health care there will be.