
Open access
Date
2009-05Type
- Working Paper
ETH Bibliography
yes
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Abstract
In this paper, we address the issue of spurious correlation in the production of health in a systematic way. Spurious correlation entails the risk of linking health status to medical (and nonmedical) inputs when no links exist. This note first presents the bounds testing procedure as a method to detect and avoid spurious correlation. It then applies it to a recent contribution by Lichtenberg (2004), which relates longevity in the United States to pharmaceutical innovation and public health care expenditure. The results of the bounds testing procedure show longevity to be linearly related to these two factors. Therefore, the estimates reported by Lichtenberg (2004) cannot be said to be result of spurious correlation, to the contrary, they very likely reflect an effective relationship, at least for the United States. Show more
Permanent link
https://doi.org/10.3929/ethz-a-005799493Publication status
publishedJournal / series
KOF Working PapersVolume
Publisher
KOF Swiss Economic Institute, ETH ZurichSubject
GESUNDHEITSÖKONOMIE + GESUNDHEITSAUSGABEN; HEALTH ECONOMY + HEALTH COSTS; PHARMACEUTICAL INDUSTRY + PHARMACEUTICAL TRADE; LIFE EXPECTANCY (HEALTH AND HYGIENE); Health care expenditure; Health; INNOVATION + MODERNIZATION; ARZNEIMITTELINDUSTRIE + ARZNEIMITTELHANDEL; INNOVATION + MODERNISIERUNG; STATISTISCHE ANALYSE UND INFERENZMETHODEN (MATHEMATISCHE STATISTIK); Innovation; LEBENSERWARTUNG (HYGIENE UND GESUNDHEIT); Pharmaceuticals; Life expectancy; Cointegration; STATISTICAL ANALYSIS AND INFERENCE METHODS (MATHEMATICAL STATISTICS)Organisational unit
02525 - KOF Konjunkturforschungsstelle / KOF Swiss Economic Institute
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ETH Bibliography
yes
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