Resource title

Do red herrings swim in circles?: controlling for the endogeneity of time to death

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Resource description

Studies on the effect of ageing on health care expenditures (HCE) have revealed the importance of controlling for time-to-death (TTD). These studies, however, are subject to possible endogeneity if HCE influences remaining life expectancy. This paper introduces a ten year observational period on monthly HCE, socioeconomic characteristics, and survivor status to first predict TTD and then uses predicted values of TTD as an instrument in the regression for HCE. While exogeneity of TTD has to be rejected, core results concerning the role of TTD rather than age as a determinant of HCE (the red herring hypothesis) are confirmed.

Resource author

Stefan Felder, Andreas Werblow, Peter Zweifel

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/26838

Resource license

Adapt according to the presented license agreement and reference the original author.