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Health insurance coverage for low-income households : consumption smoothing and investment

Liu, Kai
Working paper
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URI
http://hdl.handle.net/11250/163452
Date
2013-10
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  • Discussion papers (SAM) [579]
Abstract
I estimate the e ects of public health insurance on consumption smoothing and investigate the

extent to which the public insurance interacts with private arrangements of self-insurance. Exploiting

a dramatic expansion in health insurance coverage in rural China, I nd that the introduction of

public health insurance helps households completely insure against severe health shocks. The health

insurance also reduces the magnitude of decline during a health shock in investments in children's

education, agricultural activities and durable goods. The evidence suggests that the bene t of social

insurance for low-income households could also come from reducing the use of costly smoothing

mechanisms.
Publisher
Norwegian School of Economics. Department of Economics
Series
Discussion Papers;16/2013

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