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Type Journal Article
Scope Discipline-based scholarship
Title A flexible copula regression model with Bernoulli and Tweedie margins for estimating the effect of spending on mental health
Organization Unit
Authors
  • Giampiero Marra
  • Matteo Fasiolo
  • Rosalba Radice
  • Rainer Winkelmann
Item Subtype Original Work
Refereed Yes
Status Published in final form
Language
  • English
Journal Title Health Economics
Publisher Wiley-Blackwell Publishing, Inc.
Geographical Reach international
ISSN 1057-9230
Volume 32
Number 6
Page Range 1305 - 1322
Date 2023
Abstract Text We develop a flexible two-equation copula model to address endogeneity of medical expenditures in a distribution regression for health. The expenditure margin uses the compound gamma distribution, a special case of the Tweedie family of distributions, to account for a spike at zero and a highly skewed continuous part. An efficient estimation algorithm offers flexible choices of copulae and link functions, including logit, probit and cloglog for the health margin. Our empirical application revisits data from the Rand Health Insurance Experiment. In the joint model, using random insurance plan assignment as instrument for spending, a $1000 increase is estimated to reduce the probability of a low post-program mental health index by 1.9 percentage points. The effect is not statistically significant. Ignoring endogeneity leads to a spurious positive effect estimate.
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Digital Object Identifier 10.1002/hec.4668
Other Identification Number merlin-id:23809
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Keywords Health policy, binary response, copula, health expenditures, penalized regression spline, Rand experiment, simultaneous estimation, Tweedie distribution
Additional Information Bereits als Working Paper in Working paper series / Department of Economics No. 413 erschienen: https://www.zora.uzh.ch/id/eprint/218638/.