| Popis: |
Building upon the Grossman model (1972), we propose an extended model of health production, which accounts for the role of social network interactions and share of liquid wealth. The model predicts that both factors have a positive impact on health production. A recursive system that controls for potential sources of endogeneity of social network contacts, share of liquid wealth and health care demand is used to empirically test the theoretical predictions. The estimation results show that the share of liquid wealth directly affects health in a positive and statistically significant way. Social networks do not have a direct impact on health production, though the model suggests that they indirectly enhance health through a greater use of necessary health care services. Lastly, the empirical model evidences that social networks and the share of liquid wealth act as substitutes in the production of health. |
